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...
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