With positive earnings adding even more fuel to the market rally, some hedge funds with short positions have been caught on the wrong side of the bet. Our Chief Investment Officer Benjamin Lau, who has been long and strong throughout the historic market run, commented on the trend with Bloomberg. Below is an excerpt:

“The consensus was that earnings growth will slow down in the second half of the year. That’s why they scaled back from positioning in hopes there will be a downturn,” said Benjamin Lau, chief investment officer of Apriem Advisors in Irvine, California, where the firm oversees more than $700 million. “The momentum for earnings growth, revenue growth is quite strong. Those kind of upside surprises led to some pains.”

The full article can be read here.