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Opinion
Mark Gilbert

Short Sellers Giving In May Be a Bearish Signal

Betting against stocks and predicting bond yields have both undone hedge funds. But maybe the markets are poised to turn. 

Catherine Wood’s ARK ETF has held both big winners and big losers this year.

Catherine Wood’s ARK ETF has held both big winners and big losers this year.

Photographer: Kyle Grillot/Bloomberg

Life is getting even harder for short sellers. Some of the most famous names in the business of seeking to profit by anticipating declines in the value of financial securities are closing their positions. Time will tell if they were right to abandon their bearishness – or whether their capitulation signals a market turn.

Russell Clark, who took over John Horseman’s eponymous $3.2 billion fund in 2010 and renamed it after himself in the middle of last year, is shutting up shop, Bloomberg News reported this week. He spent the past decade speculating on a stock market decline; those wrong-way positions saw assets at Russell Clark Investment Management Ltd.’s flagship fund dwindle to about $200 million.