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Citadel is short-selling 21 UK stocks, according to the latest short position report from the Financial Conduct Authority (FCA).
Hedge funds are betting that the company’s stock price will fall in the coming weeks or months. Short-selling is a way for investors to profit from a decline in stock prices.
21 stocks in the crosshairs
Citadel is a leading hedge fund with over $62bn in assets under management.
A short position can affect the stock price. As an investor in UK stocks, I try to keep up to date with the opinions and actions of big market movers like Citadel.
As of April 6, Citadel held reportable short positions in 21 UK companies. The FCA requires funds to open short positions when they reach a certain threshold, i.e. when the net short position is equal to or greater than 0.5% of the issued share capital.
| The name of the issuer | Net short position (%) | The date the short position starts | % price change since short opened |
| Bowo Group | 0.90 | 05/04/2023 | 0.0% |
| International Distribution Services | 0.83 | 27/03/2023 | 4.3% |
| ASOS | 0.76 | 29/03/2023 | 2.5% |
| abrdn | 0.69 | 24/03/2023 | -1.3% |
| Matthew Johnson | 0.68 | 05/04/2023 | 0.4% |
| Smith & Nephew | 0.62 | 03/04/2023 | 1.7% |
| Gym Group | 0.62 | 16/03/2023 | -16.2% |
| Hanover Insurance Group | 0.61 | 07/03/2023 | -5.0% |
| Wetherspoon’s | 0.61 | 31/03/2023 | -0.6% |
| Deliveroo | 0.60 | 22/03/2023 | 5.2% |
| Elements of order | 0.60 | 30/03/2023 | -0.5% |
| Redrow | 0.60 | 03/03/2023 | -5.5% |
| Savills | 0.59 | 29/03/2023 | -0.9% |
| Assura | 0.58 | 31/03/2023 | -1.4% |
| Direct Line Insurance Group | 0.53 | 05/04/2023 | 3.1% |
| Energean Oil & Gas | 0.52 | 29/03/2023 | 3.7% |
| Barratt’s Development | 0.51 | 30/03/2023 | -3.0% |
| Intercontinental Hotels Group | 0.51 | 17/03/2023 | 3.6% |
| Berkeley Group Holdings | 0.50 | 14/03/2023 | 3.3% |
| Howden Joinery Group | 0.50 | 05/04/2023 | -2.2% |
| persimmon | 0.50 | 30/03/2023 | -2.2% |
You won some…
FCA data shows the date when a short position was opened. By looking at the changes in the stock prices of shorted companies since Citadel started shorting, I can calculate the success rate of Citadel which is up to the time of writing.
| Results, as of market close, April 6 | Number of positions (%, of 21) |
| fortunate | 11 (52%) |
| Neutral | 1 (5%) |
| loss | 9 (43%) |
Of those 21 companies, a slim majority (11) have experienced a drop in share price since Citadel began accelerating.
Citadel’s biggest success so far has been with Gym Group. The fitness company has seen its share price drop 16% since the hedge fund started shorting it on March 16.
The sale was prompted by the release of The Gym Group’s annual results, which estimated that energy costs would be £10m higher this year than in 2022. to customers. However, the company plans to open 12 more sites, all of which will be self-financed.
All the pain, no gain?
I do not short Citadel stock. Out of the 21 named, I chose only one: persimmon. The housebuilder has seen its share price halve over the past 12 months.
With a forward price-to-earnings (P/E) ratio of 9 and a strong balance sheet, I think the company is facing downside. I will add Persimmon shares to my portfolio when I have spare cash.
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