Sun, Feb 25, 2018
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hedge fund Lansdowne dumps entire $850m stake in Goldman Sachs

Monday, August 01, 2011
Opalesque Industry Update – Europe’s biggest hedge fund, Lansdowne Partners, has confirmed its decision to sell its entire $850m stake in American investment bank Goldman Sachs. The move raises question about the prospect of the global banking sector, various media reports say.

According to a report by the British newspaper The Independent, Lansdowne owns nearly one percent of the Wall Street bank’s equity. Lansdowne’s exposure in Goldman Sachs is equivalent to nearly 10%of its entire $10bn assets under management.

Others see the sale of at least 4.94 million Goldman shares as a further blow to the Wall Street Bank which saw its shares plunge to levels not seen since 2009 after results of second-quarter performance showed disappointing numbers.

Goldman Sachs reported a $1.09bn profit in the second quarter and announced a decision to cut up to 1,000 jobs worldwide.

What is significant with Lansdowne’s move is that the firm made a similar offloading decision at the height of the financial crisis in 2008 when it sold its shares ahead of the collapse of Lehman Brothers. The hedge fund is one of the top 20 investors in Goldman.

While the hedge fund’s decision to exit Goldman is due to the decline in the value of Goldman’s proprietary trading operations, many analysts hint that it also raises serious questions about the health of the global banking industry.

Banks’ proprietary trading operations are hit by new regulatory changes under the Volcker rule. Many investment banks have already disbanded their proprietary units.
Precy Dumlao

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: Global Sigma captures February's long-vol trade[more]

    Bailey McCann, Opalesque New York for New Managers: Florida-based Global Sigma rode February's volatility to new highs. The firm's AGSF strategy is up +2.8 percent through February 16 and +4.2 percent YTD a

  2. Art & Motion launches collectible car alternative investment vehicle[more]

    Komfie Manalo, Opalesque Asia: Luxembourg-based Art & Motion has launched a new investment vehicle dedicated to vintage cars and exceptional high-quality vehicles as this collectible market has grown exponentially the turn of the centu

  3. Investing - Hedge funds turn short on tech just as stock rally takes off, After biggest short, speculators slash bearish US bond bets as supply deluge looms[more]

    Hedge funds turn short on tech just as stock rally takes off From Newsmax.com: A key group of investors has just missed out on the biggest tech-stock rally since 2014. Hedge funds and other large speculators turned net short on Nasdaq 100 Index futures for the first time in 21 months, ac

  4. Low volatility funds fail to protect investors[more]

    From FT.com: A number of exchange traded funds (ETFs) designed to protect investors from sharp stock market gyrations lost more money than mainstream US stocks during a sell-off this month, underperforming in precisely the conditions in which they were meant to thrive. Low volatility ETFs, lau

  5. Legal - Hedge funds fight to save M&A arbitrage strategy, Fannie Mae and Freddie Mac ruling blow to hedge funds[more]

    Hedge funds fight to save M&A arbitrage strategy From FT.com: Hedge funds which use the US courts to wring higher prices for merger and acquisition deals are fighting to save the lucrative investment strategy, after a Delaware court ruling that threatens to shut it down. Verition Partner