Article: Kerrisdale declares short position in First Majestic Silver

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Kerrisdale declares short position in First Majestic Silver

HENRY LAZENBY, 01 September 2016

Hedge fund firm Kerrisdale Capital has declared short positions in and own option interests on the stock of Canadian primary silver producer First Majestic Silver. Kerrisdale on Thursday published a report highlighting its belief that the miner was in a “speculative frenzy” and that the company’s valuation was “outrageously detached from reality”.

The New York-based hedge fund firm argued that First Majestic’s stock price could fall between 70% to 80% from its Thursday opening price of $12.02 apiece.

According to Kerrisdale’s latest 13F filing, its US equity portfolio was worth almost $370-million at the end of June, 36.86% less than it was worth at the end of March. The fund, which has staked its bets on a rebound in the technology sector, struggled during the first half of the year, losing 12.1% during the period, compared with the S&P 500 ending the first half with gains of 3.8%.

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