Don't Be Misled By 13F Filings, They Don't Disclose Shorts, Credit Default Swap Exposure (CDS)

People, don't be misled by 13F SEC Filings reported by hedge funds and institutional investment managers every quarter. They don't have to report short positions or naked credit default swap exposure (credit insurance) against underlying long positions. Meaning 10 million shares of Company X might just be part of a large net short position. This is an interesting comment on the potential nature of Paulson's MGM holding this Q.

13F-Reports are filed quarterly by institutional investment managers (managing more than $100 million) less than 45 days after the quarter ends at SEC.gov. 13D-Reports are filed when institutional investment managers own 5% or more of a company within 10 days of the purchase. They must report material changes (acquisitions or dispositions) greater than 1% of the holding.

Comments

  1. very prudent thing to highlight. that's why it's advisable to only follow value oriented managers or true l/s managers via 13F because you can usually tell what their true longs are as they only dabble in equities. Occasionally there will be a boxed short but it's usually pretty obvious because you sit there wondering "they bought what?!"

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  2. Hey, yeah very true thanks for mentioning that. Now I'm going to check your site to see what Soros did.

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