Crossroads Capital's letter to partners for the month of October 2024, discussing what we think about short selling.
Ask any fund manager: Shorting is hard. Many elements make it hard to generate a positive return on shorts. After all, in the long run most stocks go up. Even worse, when your shorts move against you, they become larger as a percent of NAV, not smaller – compounding the pain of your mistakes. So why do it? And how do we at Crossroads avoid the common pitfalls? Below is a quick primer on our approach, and an example that...