(Bloomberg) One hedge fund manager has a novel way to profit from shares of Tencent Holdings Ltd. — whether they go up or down. The trade, a brainchild of BFAM Partners (Hong Kong) founder Benjamin Fuchs, involves buying both Tencent shares and put options, which Fuchs said are mispricing the odds of a decline in the stock. The bet will pay off if Tencent swings more than 15 percent in either direction, and produce a major windfall if the shares lose more than 20 percent, he said.
Hedge Fund’s Tencent Trade Pays ‘Huge’ on a Selloff, or a Rally
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