"While we have actually heard, check out, and seen lots of signs of capitulation from short-sellers, we stay extremely committed to the strategy," the company said in its latest customer letter seen by Reuters on Friday. In 2015 it was wrong-footed by bets versus grocer Whole Foods and mall operator General Growth Residences and stated that six of its shorts were obtained.
"It is lengthy and tough, however we understand that there will be a period when our effort pays dividends," the letter, stated about the practice of betting that certain stocks' costs will fall. The letter was dated Jan. 31, only days before the market started selling off.
Tiger Global's commitment to short-selling might relax some frayed nerves after a troubled week when the Requirement & & Poor's 500 stock index toppled 10 percent from its January peak. The company noted rising, an escalation in trade wars and geopolitical instability as prospective short-term threats to markets and stocks crumbled this week in the middle of worries that increasing prices might prompt much faster rate hikes.
Hedge funds long marketed themselves as having the ability to safeguard capital when markets drop, but during the booming market, short-selling has mostly been a drag on returns. Many companies quit attempting to choose losers.
At Tiger Global short-selling "detracted roughly 12 percent" from returns at its Tiger Global Investments portfolio, in 2017, the letter stated.
Today was seen as a sensible strategy. Information from Hedge Fund Research study show the average hedge fund lost 2.21 percent up until now this month.
Tiger Global said it was keeping its short-selling abilities even after irritating outcomes in 2017. "As our coach Julian Robertson used to say, short-selling is a bit like going to the health club. You're not just going to reveal up one day and become effective; you have to put in the representatives on a constant basis."