3 underperformers could be ready for a bounce

Nicholas Forsyth

So far 2016 has been the year where stocks that have been the significant underperformers have dramatically become the market darlings on a combination of changing economic circumstances and aggressive short covering. Some noticeable examples of this are in the resources and energy sectors e.g. BHP +16%, RIO +15%, FMG +82% and STO up 30%. Many hedge funds that have enjoyed significant profits from short positions in these sectors over recent quarters / years have been forced to cover sending these heavyweights soaring. One day gains of 5-6% have occurred on the back of ‘less bad’ corporate news or simply mass short covering. This morning we are looking at three stocks that still have large short positions and have the potential to emulate our miners / energy stocks. (VIEW LINK)


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