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Carl Icahn Scores $1.3 Billion Windfall on Bet Against Shopping Malls

  • Billionaire’s profit recorded during first half of the year
  • Financier wagered big on decline of credit default swaps index
Carl Icahn

Carl Icahn

Photographer: Victor J. Blue/Bloomberg

Investor Carl Icahn’s bet on the downfall of brick-and-mortar retailers produced a $1.3 billion gain during the first half of the year.

The profit came from a short position on commercial mortgage backed securities, Icahn Enterprises LP said Monday in a regulatory filing. Icahn’s publicly traded holding company has committed capital to his proprietary investment funds and thus reports on their returns quarterly.

Icahn, 84, began making the bet, frequently called the “mall short,” in mid-2019 by purchasing credit default insurance using CMBX 6, an index highly exposed to shopping mall loans. The likelihood of defaults soared in March as the Covid-19 pandemic led to store closures and prompted more consumers to shop online, accelerating a trend already well underway.