2 weeks Ago By Tanya Rawat
Billionaire investor David Einhorn defied market gloom in Q1 2025 with a golden strategy that delivered standout gains for his hedge fund. What Happened : Einhorn’s hedge fund, Greenlight Capital, outperformed the market in Q1 2025 by investing in gold, which surged 19% and was the “biggest winner” in its portfolio, reported Business Insider. Greenlight Capital reported an 8.
2% return in the first quarter, significantly surpassing the S&P 500’s loss of over 4% during the same period. The hedge fund, which holds both gold bars and call options, also outperformed a benchmark of hedge funds. The average fund reported a loss of 0.
4% in Q1, according to research group HFR. Greenlight Capital also indicated that the U.S.
equity market is entering a bear market. “Sensing that the market was turning, in late February we pivoted from conservative, but not bearish, to bearish,” the firm stated in its letter. See Also: A Couple In California Is Spending $1,200 A Month On Groceries For Two.
Now They’re Wondering, ‘Is This Crazy?’ The firm has lowered its net equity exposure to shield itself from sharp declines and counter-trend upswings. It also identified other trades in its first-quarter letter, including short positions on companies catering to liberal tastes, long positions in SOFR futures, “tail protection” for the dollar, and long-duration inflation swaps. Why It Matters : Speaking at the 2024 Sohn Investment Conference, Einhorn told CNBC that inflation appears to be reaccelerating and predicted the Federal Reserve may cut interest rates less than expected—possibly not at all.
He warned of a potential economic downturn if tight monetary policy persists and said Greenlight has heavily invested in gold, including both SPDR Gold Furthermore, historical data suggests that gold investments can outperform the S&P 500 during periods of economic uncertainty. This context adds weight to Greenlight Capital’s decision to invest in gold. Moreover, bearish sentiment has been on the rise, breaking a 35-year record and remaining above 50% for eight consecutive weeks.
This trend aligns with Greenlight Capital’s assertion that the US equity market is entering a bear market. Disclaimer : This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Read Next: Xi Jinping’s China Pledges Retaliation Against Countries Isolating Beijing By Giving Into Trump Administration’s ‘Unilateral Bullying,’ Says It Will ‘Never Accept It’ Photo courtesy: Shutterstock © 2025 Benzinga.
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