Bridgewater Now Net Short — $160 Billion of Extreme Fuckery

Does this mean anything to you?

The world’s largest hedge fund, run by Ray Dalio, is now net short of equities.

This just in from bearshitter in chief, Zerohedge.

All of which brings us today and a report from Bloomberg that shows Bridgewater is outperforming peers this year even after losing money in April… but it is doing it via a massive derisking…

The investment firm has gained about 4% in its Pure Alpha fund in the first four months of this year after a 1% loss last month, the person said, asking not to be identified because the information is private. Hedge funds on average returned about 0.3 percent during the first four months of 2018, according to Eurekahedge.

However, the big news was that, separately, Bridgewater’s disclosed shorts against European stocks have now declined by a massive 80% from February to just over $4 billion, according to data compiled by Bloomberg.

So, the head of research claimed the $22 billion European short was not what you thought it was and now it has been, for all intent and purpose, fully unwound. Bloomberg notes that a spokeswoman for Westport, Connecticut-based Bridgewater declined to comment.

The last 11 disclosures in Europe by Bridgewater have shown the firm is reducing some of its bearish wagers. Three of those stocks were Intesa Sanpaolo SpA, UniCredit SpA and Telefonica SA, which have all seen their share prices rise this year. The Euro Stoxx 50 Index has gained about 2 percent in dollar terms this year, including reinvested dividends, meaning short wagers have not been a profitable trade.

Additionally, Bloomberg reports that the fund made money trading developed-market currencies and rates trading in April, while losing money on its equities and emerging-market currency bets, a second person said.

The strategy has also reduced its net long bets on U.S. equities to about 10 percent of assets from 120 percent earlier this year, that person said.

And finally, the entire fund – all $160 billion of it – is now, reportedly, net short equities.

I kind of, sort. of, empathize with his stratagem, which could very easily take on a Martingale approach as equities spin higher. After all, Dalio is a billionaire cocksucker and I’d much prefer to see him eaten by a zombie than succeed in this trade. However, since I own SOXS and just doubled down on it — I was hoping the proliferation of this idle piece of news might scare people to the point of selling their stocks and buying themselves inside 12 foot graves.