Hedge fund that profited from Quindell share price collapse revealed
The hedge fund that profited from the collapse of Quindell’s share price has been unmasked.
Tiger Global is a little-known £10billion New York hedge fund that has been revealed to have made some large bets against European companies.
Using a labyrinth of holding companies in the Cayman Islands to mask its true identity, the company made multi-million pound financial bets against companies including Nokia, HMV and Quindell, according to an investigation by hedge fund
Up: Quindell’s shares jumped by nearly 32 per cent on Friday
Short-sellers, who make a profit if prices go down, often borrow the shares and then immediately sell them.
When the time comes to give them back to the borrower, the short-seller simply buys shares on the open market, for a lower price and gives them back, pocketing the difference. Tiger also made large bets against Blinkx, Mike Lynch’s video advertising company that saw its shares collapse after a Harvard professor questioned the business model of internet advertising.
Quindell saw £1billion wiped from its shares on the day that research firm Gotham City claimed it was ’built on quicksand’.
Shares have since fallen 95 per cent to the level that Gotham predicted in its note – making large profits for any organisation that had ‘shorted’ Quindell’s shares.
Quindell’s shares yesterday rose nearly 32 per cent to finish 17p higher at 70.75p.
The shares have soared after hitting a low of 43p two days ago.
They hit a peak of more than 600p before the Gotham report.
IMAGE: Up: Quindell’s shares jumped by nearly 32 per cent on Friday
See iNews Cayman related story published November 23 2014 “Tiger Global used shell company [in Cayman Islands] to short sell Quindell” at: http://www.ieyenews.com/wordpress/tiger-global-used-shell-company-in-cayman-islands-to-short-sell-quindell/