How to Work over Short Selling Hedge Funds 101 by Rupert Murdoch

Monday, August 15 2011

Newscorp closed up 17% last night and has now recovered what it lost during the phone hacking scandal.  This is quite a surprise given the slowdown that has occurred in the US would be impacting their earnings.  However it appears that Rupert has closely followed the amount of short sellers on his register and extracted some revenge (he is not known as the forgiving type).

Specifically at his result presentation he announced:

1. Profit guidance of low double digit growth (albeit he has little visibility around earnings).

2. That he would aggressively buy-back his shares.

3. And that a future CEO would be Chase Carey not his son James.

This triggered short covering in an astonishing rally.  It also highlights how short the market is in some of these stocks and possibly presents a lesson to other Boards worried about the shorts on their register.  Note this tactic only works if you have a strong balance sheet and sound business.

 

Disclaimer

The website is owned and operated by DNR AFSL Pty Ltd (AFSL 301658) (“Dalton Nicol Reid”) having its registered office at Level 14, 388 Queen Street, Brisbane, QLD 4000.

The content of this website is intended for Australian residents only (RG 162.44).

* Whilst perhaps not strictly an Internet Discussion Site (“IDS”) as defined in Regulatory Guideline RG 162 as investors and or other third parties are unable to leave comments on the site, the information on this site is so provided being mindful of the requirements and intended purposes of RG 162 and Consultation Paper 104.

Information about ASIC IDS guidelines and other relevant information about investing may be obtained from the ASIC website at:

https://www.fido.gov.au/asic/asic.nsf/byheadline/AD09-33+ASIC+reviews+policy+on+internet+discussion+sites?openDocument.

 

Not Investment Advice

Postings are, at best, general information, not professional investment advice prepared by taking into account any individual circumstances and needs of particular investors.Therefore, before acting on the basis of what is said in a posting, you should:

  1. consider consulting a licensed adviser (ASIC’™s website at www.asic.gov.au has a list of licensed advisers); and
  2. visit ASIC’™s consumer website at www.fido.gov.au for general guidance about investing.

GENERAL

Dalton Nicol Reid, its associated entities, and directors and staff, may hold positions in companies, or the debt or derivative securities of companies, either on their own account or for the portfolios of investors, that are the subjects of postings on this website.

Dalton Nicol Reid is a member of FOS (https://www.fos.org.au/centric/home_page.jsp) which is an ASIC approved external complaints resolution scheme (RG 162.46).

The information posted on this site by Dalton Nicol Reid will be maintained and kept by Dalton Nicol Reid consistent with the requirement of RG 162.62 and* Consultation Paper 104* for a minimum of two years and may be made available to ASIC.

 

Accuracy and Currency of Information

Dalton Nicol Reid, its officers, employees, agents and associates believe that the information and material provided on this web site is correct at the time of compilation but do not warrant the accuracy or currency of that information and material. You should carefully check the date of compilation of the information and material (where relevant) to determine its currency. Save for statutory liability which cannot be excluded, Dalton Nicol Reid, its officers, employees, agents and associates disclaim all responsibility for any loss or damage which any person may suffer from reliance on the information and material on this web site or any opinion, conclusion or recommendation in the information and material whether the loss or damage is caused by any fault or negligence on the part of Dalton Nicol Reid (including its officers, employees, agents and associates) or otherwise.

 

Loss or Damage to your Systems

Dalton Nicol Reid will not be liable for any loss or damage from any cause to your system or web site, or to people linking to this material from your web site, caused by or in connection with the use or link to this material. Any such loss or damage will be your responsibility. Dalton Nicol Reid advises you to take your own precautions in relation to protecting your system or web site from malfunction or viruses.

 

Copyright

Copyright in all the material, works, software, design, text, graphics and code contained on or used to produce the web site and in the information and material and in its arrangement or layout, is owned or licensed by Dalton Nicol Reid or its associates unless otherwise indicated. Other than as permitted below, your use of anything in which Dalton Nicol Reid or its associates own copyright is governed by the copyright laws of Australia and its international treaties with other countries.

You are permitted to save or print a copy of the web site solely for your own information, research or study, but only if you do not modify the copy and you include the copyright notice “© Dalton Nicol Reid Pty Ltd. ” on the copy. You may not copy, publish, distribute, create works from or commercially exploit the content of this web site for any other purpose.

Print this article