New York (HedgeCo.net) – Metals and mining stocks have been under pressure for some time now, in fact you the SPDR S&P Metals and Mining ETF (NYSE: XME) peaked in June 2008 and has fallen over 80% since then. The XME is down over 50% so far this year and the decline in materials prices is starting to take a toll on the fundamental operations of mining companies.

Anglo American, the fifth largest miner by market cap, announced yesterday that they were suspending their dividend payments, cutting capital expenditures and reducing their work force by an additional 85,000. The stock tumbled 12.94% after the announcement and it is down 73.3% on the year.

According to a recent article from the Wall Street Journal, several hedge funds have scored major gains by shorting Anglo American stock. The article listed five different funds with sizable short positions: Discovery Capital Management, Key Group Holdings, Lone Pine Capital LLC, Odey Asset Management and Pointstate Capital LP. None of the five funds were willing to comment for the Journal’s story.

Rick Pendergraft
Research Analyst
HedgeCoVest