Thursday, January 26, 2017
The Dutch government accidentally published a list of George Soros's short bets
Holland's markets regulator "inadvertently" posted details on its website of short positions held by hedge funds in the Netherlands, including those of billionaire George Soros,according to a report in the Financial Times.
Hedge funds take short positions when they expect the price of a particular asset to fall. So, in other words, it is what hedge funds are betting against.
The details were briefly posted on Tuesday, showing Soros to have bet against Dutch bank ING, taking a short position of 0.3% in the lender in June 2016, the FT reported. The short bet was one of hundreds listed on the site, going back to 2012, according to the FT.
The AFM also revealed that the secretive Medallion Fund, run by Renaissance Technologies for its employees, shorted a number of small cap Dutch stocks.
The Medallion Fund is one of the most successful quantitative trading funds ever, making an annualised return of over 70% in the 20 years from 1994 to 2014.
"On the afternoon of Tuesday 24 January, after the close of the market, the AFM inadvertently published a list on its website that included net short positions of less than 0.5% instead of publishing the daily list of net short positions of 0.5% and higher," the AFM said in a statement on its website.
"The AFM corrected this mistake and posted the correct list of net short positions of 0.5% and higher on the morning of Wednesday, 25 January. We regret this error."
A successful short trade often involves borrowing the stock of a company from an investor, selling it and then buying it back at a later date for a lower price, pocketing the difference.
European Union rules in force since 2012 require hedge funds to disclose to the public short positions of over 0.5% in a particular company's stock. Positions of over 0.2% only have to be made known to the domestic markets regulator, updated for each additional 0.1% – it is these non-public trades that the AFM briefly revealed.
Soros, who made a $1 billion betting against the pound in 1992, is famed for his short trading. A day after the UK's June 23 referendum to leave the European Union, he took out a $108 million short position in Deutsche Bank.