Latest news with #arbitrage
Reuters
7 days ago
- Business
- Reuters
Singapore hedge fund Arrowpoint capitalised on May market turmoil
HONG KONG, June 3 (Reuters) - Singapore's multi-strategy hedge fund Arrowpoint Investment Partners has made gains by exploiting market dislocations triggered by global trade tariff shocks and sees more arbitrage opportunities ahead, its chief investment officer said. Since mid-April, the $1.1 billion fund has capitalised on extreme dislocations in equities, currencies and bond curves, founder and CIO Jonathan Xiong told Reuters. May was the fund's best month since its launch last July, up more than 3%, said a person familiar with the matter who declined to be identified. By comparison, multi-strategy hedge funds were on average flat in April, data from With Intelligence shows. Backed by Blackstone, the Canada Pension Plan Investment Board and Temasek's Seviora, Arrowpoint was Asia's largest hedge fund startup last year. It now has around 110 staff with over 20 trading pods. "Everything has got more volatile, but there are also opportunities that were so abundantly clear," said Xiong, a former Asia co-CEO of Millennium Management. Arrowpoint exploited dislocations in Asia FX markets using non-deliverable forwards and profited from Australian rate curve anomalies following U.S. President Donald Trump tariff announcements, Xiong said. It was able to take advantage of temporary mispricing in asset prices, betting they would eventually revert to normal levels. "One thing I noticed is that Asia dislocations take much longer to come back as the market is less liquid compared to the U.S.," Xiong said. Arrowpoint, however, stayed clear of Japan's rate markets, where super-long bond yields were driven to record highs in May. "The risk premium injected towards the longer end of the Japan curve may be warranted given investors' repricing of global bond term premiums," he said. At the Sohn Hong Kong Investment Leaders Conference on Friday, Xiong pitched a long China/short Japan 'risk parity' trade, which involves buying China stock index futures and 5-year government bonds, while shorting similar Japanese assets. He said investor interest in Asia-based multi-strategy funds is rising as there's growing concern about over-exposure to U.S. markets.
Yahoo
18-05-2025
- Business
- Yahoo
Jim Chanos Goes Long Bitcoin, Short MicroStrategy In Arbitrage Bet Against Retail Speculation
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Veteran short seller Jim Chanos on Thursday revealed a strategic arbitrage trade: long Bitcoin (CRYPTO: BTC), short Strategy (NASDAQ:MSTR). His position targets what he described as a widening and unjustified premium on MicroStrategy's stock relative to its Bitcoin holdings. 'We're buying Bitcoin, selling MicroStrategy stock—an arbitrage play, buying for $1, selling for $2.50,' Chanos said during the talk. Don't Miss: Trade crypto futures on Plus500 with up to $200 in bonuses — no wallets, just price speculation and free paper trading to practice different strategies. Grow your IRA or 401(k) with Crypto – unlock the power of alternative investments including a Crypto IRA within your retirement account. He emphasized that the core trade isn't based on predicting Bitcoin's price direction but exploiting the spread between MicroStrategy's net asset value (NAV) and its trading price. 'I don't know where Bitcoin is going.. $100,000, a million, $10,000. I don't know. I don't think anybody else knows,' he said. "But what I do know is it's generally profitable to short $1 for $2.50 or three dollars." Chanos, who has intermittently held this position over the past few years, criticized what he sees as a flawed narrative among retail investors: buying into corporate structures like MicroStrategy as a proxy for direct Bitcoin exposure. "They are basically selling retail investors the idea that we are going to buy Bitcoin in a corporate structure... and therefore earnings are created by the difference between what new investors are paying with the net asset value is,' he said. He likened his own approach to that of Strategy founder Michael Saylor saying, "We're doing exactly what MicroStrategy and Michael Saylor are doing," highlighting that his trade simply reverses the structure: directly buying Bitcoin while selling the stock. Chanos also pointed to the premium to NAV as a barometer of market speculation, noting it has recently returned to levels seen at the end of 2024. "It's a good barometer, not only just of the arbitrage itself, but I think of retail speculation," he added. Read Next: New to crypto? Get up to $400 in rewards for successfully completing short educational courses and making your first qualifying trade on Coinbase. A must-have for all crypto enthusiasts: Sign up for the Gemini Credit Card today and earn rewards on Bitcoin Ether, or 60+ other tokens, with every purchase. Image: Shutterstock Send To MSN: Send to MSN This article Jim Chanos Goes Long Bitcoin, Short MicroStrategy In Arbitrage Bet Against Retail Speculation originally appeared on
