Deep Dive: Short sellers are not just 'opportunists, speculators and profiteers'

Carries own set of risks

Eve Maddock-Jones
clock • 4 min read

‘Going short’ can be a useful protective portfolio management tool, but it carries the risk of unlimited losses, experts warn.

John Leiper, CIO at Titan Asset Management, explained that the ability to ‘go short' "improves market liquidity and broadens the range of investment strategies that can be employed by an asset manager". "Markets spend most of the time going up, but that trend cannot last forever." He said markets are subject to cycles, driven by both "behavioural biases and the ever-evolving macroeconomic backdrop", which would "typically results in declining asset prices. Asset managers can benefit in such an environment by shorting stocks thus generating profits for clients that they might otherwise...

To continue reading this article...

Join Investment Week for free

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

More on Equities

Partner Insight: Can an Active All Cap Approach Consistently Add Value Over Time?

Partner Insight: Can an Active All Cap Approach Consistently Add Value Over Time?

We consider whether active stock selection across the market capitalization spectrum can consistently add value across varying market conditions.

Justin White, Portfolio Manager at T. Rowe Price
clock 14 November 2023 • 4 min read
Andre Desautels, Equity Portfolio Manager at Wellington Management

Partner Insight: Could being boring pay dividends for equity income investing?

Andre Desautels, Equity Portfolio Manager at Wellington Management
clock 10 November 2023 • 6 min read
The equity market has experienced significant market volatility over the past few years due to unprecedented events.

Higher for longer: The hope for equities lies in selection

Falling profits could reduce valuations

clock 30 October 2023 • 5 min read
Trustpilot