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From Precy Dumlao, Opalesque Asia:

The Kerrisdale Partners fund, managed by New York-based private investment manager focusing on value and special situations investments Kerrisdale Capital Management, LLC, beat all market volatility as it closed the third quarter up +153.7% as the fund continued to benefit from shorting of U.S.-listed Chinese firms, compared to S&P 500 which was down -8.7% during the same period.

In its communication with investors, Kerrisdale said it is shorting Chinese companies it believes are falsifying their public financial statements. The fund’s top five positive contributors were all shorts in Chinese companies that it believes are defrauding investors. This sector has been an integral contributor to Kerrisdale’s returns over the past four quarters. Kerrisdale’s top five negative contributors were Aeropostale, CSX Corp., LyondellBasell Industries NV and shorts in two U.S.-listed Chinese companies.

Kerrisdale has been shorting Chinese firms listed in the U.S. stock exchange particularly those that were accused of fraud. The fund is not the only hedge funds that have been shorting Chinese-listed firms through a backdoor process known as a "reverse merger" or "reverse takeover" that requires them to disclose less information to investors than a traditional initial public offering (See Opalesque Exclusive: ......................

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