Latest News

Reddit Jolts Activist-Short Hedge Funds Into ‘Adapt or Die’ Mode


Your free daily email from Fuller Treacy Money

Comments of the Day

28 January 2021


Video commentary for January 27th 2021


Eoin Treacy’s view

A link to today’s video commentary is posted in the Subscriber’s Area. 

Some of the topics discussed include: short covering rallies in retail favourites, mania or reversion to the mean, Dollar carry trades unwind puts pressure on risk assets. ECB jawboning effective in the short term.


ECB Officials Agree to Push Back on Market Rate-Cut Skepticism

This article by Carolynn Look for Bloomberg may be of interest to subscribers. Here is a section:

The discussion resulted in President Christine Lagarde placing a special focus on the wide range of options available to the ECB, when she declared on Thursday, with an emphatic pause, that policy makers stand ready to adjust “all” tools if needed.

Officials are not currently considering another cut in borrowing costs in the short term, the people said. One of them said investors shouldn’t be ruling out such an action at a time when economic uncertainty remains high and the euro is relatively strong.


Eoin Treacy’s view

There is a growing antipathy at the ECB to the strength of the Euro. The jawboning began about a month ago and was amped up with today’s announcement. The ECB is reluctant to cut rates further into negative territory but they are also alarmed at the strength of the currency. Europe’s path to recovery from the pandemic will be built on exports and a strong Euro is not helpful.


Reddit Jolts Activist-Short Hedge Funds Into ‘Adapt or Die’ Mode

This article by Michael P. Regan, Bailey Lipschultz and Anders Melin for Bloomberg may be of interest. Here is a section:

The days of “smash-and-grab” shorting are over, according to veteran bear Marc Cohodes, referring to investors who release a critical research report and then quickly cover their positions following an initial share price drop — or those who piggyback on others’ work and crowd into bearish positions. More
discipline will be required, he says.

“The last thing the referee tells you when you’re in a boxing match before they ring a bell is ‘protect yourself at all times,’” he said. “And these big hedge funds who’ve been short and over-concentrated in these names have been arrogant, pompous and didn’t realize they were overstretched.”

The big lessons of the last week are pretty simple, according to Fraser Perring, founder of Viceroy Research: “If you go short, make sure you have a position that in some way preserves some capital if the trade goes against you in the short term. If the cost of that strategy is too high, the risk isn’t worth it.
Price discovery is officially suspended.”


Eoin Treacy’s view

13-f filings are required to be filled out every quarter. They detail what funds managing more than $100 million held over the quarter. Retail investors tend to pour over these filings because some funds also put their options positions in the filings. Activist funds hope that by publicizing their short positions they will gain additional adherents. The opposite is occurring at present which is what landed Melvin Capital in trouble.


Email of the day on positioning and evidence of a mania:

I wanted to provide some input to the question you asked subscribers today on how we are invested and cash levels.

I am close to 70 years old and just retired. My investment portfolio is my pension which comprises stocks and property. For me, within my own fairly conservative criteria I am close to fully invested in the stock component of my pension. In the final 4 months of last year I invested additional cash in FTM themes such as  emerging markets, metals and mining and renewables. A large portion went to South East Asia where I have built some knowledge over the years and saw real value, often with good dividend yields. The remainder of my portfolio is in a portfolio of US stocks which I have managed for some years but the contents of which I rotate as trends change. A small percentage is in continental Europe plus UK Investment Trusts the latter following FTM themes. I have additional cash available which I might invest in stocks if the market declines providing a buying opportunity or I may invest in property if a suitable opportunity arises. But the cash will be invested either in stocks or property  within the coming year.


I also maintain a cash or cash equivalent position amounting to several years living and recreation costs which will never be invested in stocks. Maybe overly conservative but I’ve been investing from the mid 1980’s, when I first subscribed to FM, and this way I can sleep at night knowing I wont need to sell assets to fund living costs.  


I am usually about 20-25% in cash. Now about 50% and I almost feel like I should be 75-80% in cash.  Just don’t see why the world is so much better now vs 1 year ago today pre-covid-other than low cost of money.  Seems like a lot of pent-up demand and fear not to get in has made the market frothy…kinda like the run on toilet paper……


Eoin Treacy’s view

Thanks to a number of subscribers for responding. The responses so far tell me that while there is evidence of froth in the market, we are not at a point where there is a risk of an imminent end to the reflation. Many investors went 100% to cash in the summer and are still only beginning to get back into the market.


Eoin’s personal portfolio – stop triggered on hedge position

Eoin Treacy’s view

One of the most commonly asked questions by subscribers is how to find details of my open traders. In an effort to make it easier I will simply repost the latest summary daily until there is a change.


This is your daily comment from
Subscribe to Fuller Treacy Money Limited for exclusive content and audio: Click here for details.


The information provided on this website ( is for the purposes of information only. This website and its content is not and should not be considered or deemed to be an offer of or invitation to engage in any investment activity. Nothing Fuller Treacy Money does and nothing on this website is intended to operate or be construed as the giving of advice or the making of a recommendation by Fuller Treacy Money to any investor or prospective investor. Fuller Treacy Money and any other group or associated company of it is not authorised or regulated by the Financial Conduct Authority in the UK or any other regulatory body in any other jurisdiction. By means of your login to our service you are deemed to thereby accept our current Terms of Business including this notice, Except for permission to download a single copy for personal use, the research published by Fuller Treacy Money may not be reproduced, distributed or published in whole or in part by any recipient for any purpose, without the prior express consent of Fuller Treacy Money. Information featured on the website is based upon information and data provided by Fuller Treacy Money and remains the intellectual property of Fuller Treacy Money. Some of the information may also be provided by third parties and whilst Fuller Treacy Money will seek to ensure that information featured the website is updated on a regular basis, Fuller Treacy Money does not accept any responsibility for, and disclaims any and all liability for, any such information (including the accuracy of such information) or views or opinions expressed on the website. Any person considering an investment opportunity as a result of data presented on the website should give full regard to all the content of the website, and should perform their own due diligence and obtain advice from suitably qualified professional advisers before investing. Prospective investors are also encouraged and recommended to take their own independent legal and taxation advice together with any other advice that they may consider necessary to consider the benefits and risks attached to any investment opportunity. No representation or warranty, expressed or implied, is or will be made or given by Fuller Treacy Money (including its executives, employees, agents, contractors and advisors) in relation to the accuracy or completeness of the contents of the website, save that any such liability is not excluded in respect of fraudulent misrepresentation.

Flying cars to get first dedicated airport in Coventry as part of Hyundai collaboration

Previous article

Keywords Studios story has lot further to run says broker

Next article

You may also like


Leave a reply

Your email address will not be published.

More in Latest News