Hedge fund giant limits exposure to 5-year losing bet

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Bill Ackman says he’s still confident about betting against Herbalife Ltd.’s stock, but he’s making sure he won’t lose more money if the shares keep going up.

Pershing Square Capital Management, Ackman’s hedge fund, has shifted its Herbalife investment from shorting the stock to buying put options, he said in an interview on Bloomberg Television.

That reduces the exposure if the shares continue to rise - something they’ve been doing for most of the past five years.

“Less downside, more upside,” Ackman said. The bet against Herbalife now accounts for just 3 percent of the firm’s capital, he said.

The move brings a new wrinkle to a saga that began in late 2012, when Ackman announced a $1 billion bet against the company and called it an illegal pyramid scheme. His campaign against Herbalife has included spending millions to investigate the business, which prompted a federal investigation. Ackman also was featured in a documentary film.

Hit the link below to access the complete Bloomberg News article:

Ackman Limits Herbalife Exposure as Stock Surges 48% This Year

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