Taking stock of the Goldman scandal
Tue May 25, 2010
Few hedge funds are willing to bet against the Teflon firm, but not many are going long, either.
By Leah McGrath Goodman
What’s the best way to play Goldman Sachs, the
once-mighty but now-besieged investment bank? With the
Securities and Exchange Commission charging the firm with
securities fraud, the U.S. Attorney’s office
investigating fraud allegations and Congress poised to finalize
sweeping financial reforms, is it time to short, or at least
sell Goldman shares? It’s tough for hedge funds to
believe that Goldman won’t somehow come out on
top, but even so, some are backing away from the firm.
Kent Holden, portfolio manager at Holden Asset Management, his
eponymous long-short hedge fund in Greenwich, Conn., liquidated
three-quarters of the fund’s Goldman stock in
April—he bought it at $90, so still turned a profit.
Until then, Goldman had been one of his top-five long holdings.
But will he sell the rest of his Goldman shares? Holden
isn’t saying. "I would rather discuss the New York
Yankees. Do you have...
ISSN: 2151-1845 / CDC10004H
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