George Soros is Shorting The Trump Rally
Recent SEC filings reveal that George Soros has placed big bets against the stock market.
The position is costly, the S&P 500 index is up 9.4% since the November election of President Donald Trump, whom Mr. Soros strongly opposes.
Mr. Soros’ bets Vs stocks came in the form of Puts, or options to sell, on 2 exchange-traded funds that track broad market indexes.
He took out a Put position of 2.5-M on the iShares Russell 2000, a fund that tracks the small-cap index, according to an S&P Global Market Intelligence analysis of Mr. Soros filings with the Securities and Exchange Commission.
That ETF is up 21% since bottoming just before the November 8th election.
That position had a notional value, if the puts were exercised of $330.6%, representing a 59% increase from the $208.4-M value in Q-3.
He also held 493,000 Puts on the SPDR S&P 500 ETF, which tracks the large-cap index. The notional value of those puts was $110.2-M, a 27% decline from the previous quarter, according to S&P.
Mr. Soros also had a short position on industrial stocks, with $77.8-M worth of Puts on the SPDR Industrial Select Sector fund. That ETF has gained 12.3% since the beginning of Q-4.
Mr. Soros countered his short exposure with bets on banks. He held $72.7-M worth of Calls, or options to buy, on the SPDR Financial Select Sector ETF, which holds large-cap banks as well as other financial giants including B-class shares of Berkshire Hathaway (NYSE:BKS.B). The fund is up nearly 27% since the start of Q-4.
Soros’ New York-based firm disclosed a $14.9-M position in Goldman Sachs (NYSE:GS) and made a new bet on Bank of America (NYSE:BAC) worth $3.9-M. One of its biggest buys during the last 3 months of Y 2016 was a call option on the S&P Select Sector SPDR Fund – Financial Sector worth $72.6-M.
The data reveals that number of asset managers bought into financial stocks during Q-4 of Y 2016 after Donald Trump’s Presidential victory suggested that tax cuts and a reduction of regulatory burdens plus higher interest rates could benefit the financial sector.
Mr. Soros recently brought on a former UBS executive Dawn Fitzpatrick to be the firm’s CIO (chief investment officer), putting a woman in charge of his portfolio for the 1st time.
The Short positions, bets on a stock declining, were “between 0.2 and 0.5%,” of shares outstanding in the companies shorted the data shows.
George Soros’ political bent is to the far left and he has been linked to the anti-Trump movement in America.
|HeffX-LTN Analysis for SPY:||Overall||Short||Intermediate||Long|
|Bullish (0.38)||Bullish (0.38)||Bullish (0.48)||Bullish (0.29)|
Have a terrific President’s Day weekend.