Numbers normally speak for themselves with investment returns. It is a rare case when no figure can portray the full impact.The article goes on to say that the position ending up costing Greenlight over one percent of its performance for the year.
Hedge-fund manager David Einhorn (left), of New York’s Greenlight Capital, in a recent investor letter listed in a table the internal rate of return of 14 positions he closed in the first quarter. A bearish bet on jewelry retailer Zale generated a return of 92% and another on U.S. Bancorp returned 78%, Greenlight said in the May 1 letter. Then there were investments in companies such as Dr Pepper Snapple Group and Aldar Properties that generated losses of 46% and 91%, respectively, it continued.
But for the by now infamous Volkswagen trade, which dealt a punishing blow to hedge-fund managers around the world last year, Greenlight didn’t list a figure. It simply said, “bad.”
The only additional explanation it gave: “a relatively small position that caused a large loss.”
Friday, May 15, 2009
Einhorn Doesn't Like Bugs
At least not of the Volkswagen variety. A recent article in the Wall Street Journal explains why: