Harvard looking for short-sellers

A couple of weeks ago, the Financial Times published an article highlighting the cautiousness Harvard’s $38 billion endowment fund was now exercising with respect to its outlook for global financial markets.

It’s perhaps little wonder. Take a look at the table below circulated by economic observer, Cullen Roche, last month. Every single major asset class has negative one year returns!Screen Shot 2015-10-13 at 10.51.49 am

In the case of Harvard, they have put the call out to investment managers with expertise in short selling. As investors in Montaka will already know, holding a well-constructed short portfolio in parallel to one’s long portfolio of investments serves two key objectives: (i) to dramatically increase the downside-protection of the overall portfolio; and (ii) to allow the investment manager of the short portfolio to add value through superior stock selection.

In the current volatile market environment, in which downside risk clearly persists, a well-constructed short portfolio is enormously valuable to investors.

Screen Shot 2015-11-11 at 12.08.48 pmAndrew Macken is a Portfolio Manager with Montgomery Global Investment Management. To learn more about Montaka, please call +612 7202 0100.

Leave a Comment

Your email address will not be published. Required fields are marked *