George Soros, the billionaire investor and philanthropist, has taken a £20m short position in Aston Martin, whose share price has dropped by a quarter since its flop float last month.
Disclosures to the Financial Conduct Authority (FCA) show both Soros and French fund Carmignac Gestion have bet against the carmaker, which has seen £1bn wiped off its value since its initial public offering in early October.
The luxury car company has struggled since its highly-anticipated debut, and its shares are approaching their late-October low of 1,375p – currently sat at 1,410p having slid since early last week.
Soros Fund Management UK (SFM), a hedge fund backed by the Hungarian-American financier, is shorting 0.52 per cent of Aston Martin’s shares, according to FCA filings. Investors short stocks when they believe a company’s share price is likely to fall – meaning SFM thinks the company faces a further drop.
Soros is known as the man who “broke the Bank of England” after he bet against the pound with huge success during the 1992 Black Wednesday crisis. In recent years, his political philanthropy has been subject to increasing attention, after he made prominent donations to the US Democrats and anti-Brexit campaigners. Last month, American authorities intercepted a bomb that had been sent to his home.
Aston Martin could face pressure in the new year, when a six-month lock-up period ends and its restricted shareholders are allowed to sell their stakes. Laith Khalaf, senior analyst at Hargreaves Lansdown, said the the company still had reason to be optimistic as it aims for growth in the east Asian market, which has shown a strong appetite for luxury products, and expands into the SUV market.
“Aston Martin is enjoying a bit of a renaissance, and it’s got a new direction in terms of where it’s heading,” Khalaf said. “It’s going to capitalise of high-net-worth consumers, particularly in the far east.”
“The trick for Aston Martin to pull off is to expand its production without damaging its exclusivity, its brand, because obviously the more cars you produce, the less exclusive you are,” he added.