Investment trust insider on investment company short positions – James Carthew: The UK’s most shorted investment companies
The pound is sliding. This is hardly surprising given the state of the nation’s finances and the apparent sprouting of a magic money forest to fund tax cuts and energy price subsidies. Against this backdrop, I find it hard to be positive on the outlook for the UK market and it seems as though many investors agree as the UK is said to be the most shorted major market currently.
The FCA publishes a list of disclosable short positions on UK stocks each day and it makes for interesting reading. This article is based on the position at the close of business on 7 September.
The investment companies sector is not much affected by investors betting on a fall in target share prices, however a handful of names crop up.
Chrysalis Investments (CHRY) features with a 0.7% short position. I have been looking at Jupiter’s growth capital fund as the share price discount has now ballooned to 56% against a net asset value (NAV) updated to the end of June. The fund managers’ focus has switched from identifying new investments to preserving value within the existing portfolio, and there is cash available to do that following the takeover of Embark earlier this year.
More of the portfolio is said to be achieving profitability and there are some decent businesses in there. We are waiting to see what will happen to the controversial performance fee – an announcement is expected soon. CHRY would likely rally if sentiment switched decisively back in favour of growth stocks, but a stock-specific move is possible too if one of its portfolio companies manages to float.
There is a 0.7% short position in… read more here