While it is rather rare that value gurus sell stocks short, Robert Olstein has been selling short in his Financial Alert Fund. The accountant-turned fund manager spots values by looking behind the numbers. In the second quarter of 2004, Robert Olstein sold short American Italian Pasta Co. (PLB) at $31. After about 6 months he covered at $20, easily made more than $1 million for his fund. Currently he is shorting two stocks: Computer Sciences Corp (CSC) and Fleetwood Enterprises Inc (FLE), although things do not always go that smoothly.
Robert Olstein is certainly one of the best money managers (that is why he is in GuruFocus's Hall of Fame). The strategy of looking behind the numbers has brought his fund a 15.5% average annual return over 10 years after all fees. Its only down year was 2002, off 19%. In 2000, the year the tech bubble burst, the fund was up 12%, and in 2001, up 17%.
Robert Olstein started shorting Computer Sciences Corp (CSC) in the first quarter of 2004 at an average price of $41. He said that the accounting of CSC is not in accord with its economic reality, CSC is worth about $30. The price of CSC did not go down, however. He then shorted more shares. But the price of CSC went up, by the fourth quarter of 2004, the price of CSC was $56. It came down some in the first quarter of 2005, Robert Olstein was confident enough to short more shares again. As of the end of the first quarter, his shorting position in CSC totaled 504,500 shares with an average price of $42. As of this writing, the price of CSC is $46.4.
The other short selling of Robert Olstein is Fleetwood Enterprises Inc (FLE). He thinks that Fleetwood Enterprises Inc is worth about $5-6 per share. He sold short 1,195,500 shares of FLE at about $9.2 per share in the first quarter of 2005. Right now Fleetwood has a price of $9.5 per share.
Interestingly, another highly respected value manager, GuruFocus guru, Robert Rodriguez, does not agree with his value peer Olstein. In the fourth quarter of 2004, Rodriguez added 269,500 shares of FLE to his holdings at around $14 per share. As the share price dropped to $9, he added 2,261,900 more shares, which makes his total holding of Fleetwood to 3,714,400 shares.
Who is right, Robert vs. Robert?
Dr. Charlie Tian is the Director of Research of GuruFocus.com, a website tracks the stock picks and market insight of guru investors such as Warren Buffett, George Soros etc.
1. Begin investing immediatelyProcrastination is the number one enemy of... Read More
The American Football season just came to an end with... Read More
For instance, if the market moves up in the first... Read More
The Value of Gold in a Era of Paper Assets,... Read More
Recently, my family and I took a trip to Maine... Read More
Arthur Levitt, during his tenure at the SEC, experienced many... Read More
Press releases are a means through which companies can keep... Read More
No matter how much money you make, it pays to... Read More
For a successful retirement investment plan to work in the... Read More
A barrel of oil bounced to over $60 Thu, which... Read More
Many people buy annuities according to their agent's recommendations. However,... Read More
Leaders are stocks that breakout immediately when the market confirms... Read More
With visions of an ATM in every neighborhood in China,... Read More
I said last week that money doesn't generally buy happiness,... Read More
The most basic aspect of trading is learning to differentiate... Read More
Investors usually don't have an aversion to buying an asset.... Read More
I'm sitting here at my computer desk with a cup... Read More
When you start your program to purchase your "ideal" company,... Read More
Before every protective put trade it is possible to calculate... Read More
Ask this question to 100 people and you will receive... Read More
The Roth is kind of weird until you get used... Read More
There are several reasons people give for not investing their... Read More
I am sure you have probably read about the power... Read More
The economic data reported Fri showed continued above trend growth... Read More
CATCHING A FALLING KNIFEOne of the most common mistakes made... Read More
Putting Rare Coin Market Cycles to Work for You...Until recently... Read More
In less than four years, the price of oil has... Read More
For many investors, and even some tax professionals, sorting through... Read More
When it comes time to retire how many people would... Read More
Rich people: fortunate, lucky, selfish, and arrogant? Or highly educated,... Read More
Do you ever wonder exactly what's going on in the... Read More
Do you rule your superannuation or does it rule you?It's... Read More
As a trader, one of the key things that I... Read More
The Moving Average Convergence Divergence charts, or MACD charts for... Read More
One of the fundamental principles of finance is the concept... Read More
The Light Crude Continuous Contract hit an all-time high at... Read More
One of the leading traders on Chicago Mercantile Exchange, because... Read More
One important aspect of trading the markets is to understand... Read More
Investors are still too slowly realizing what the academics have... Read More
Let's see, he had some oats, fresh alfalfa and his... Read More
What are Bonds?A bond is a debt security, by which... Read More
Putting Rare Coin Market Cycles to Work for You...Until recently... Read More
In the last two decades, even though gold prices have... Read More
"All human power is a compound of time and patience!"... Read More
"Financial planners are like dentists: they may occasionally inflict pain,... Read More
You'll want to opt for the no-load or institutional share... Read More
Leaders are stocks that breakout immediately when the market confirms... Read More
There are many steps in calculating the fair value of... Read More
Ask this question to 100 people and you will receive... Read More
Rolling is defined in options online trading as moving a... Read More
I love to collect quotes as they concisely promote a... Read More
Here are ten more WISDOM packed GEMS that ooffer very... Read More
I had the pleasure of being invited on a friend's... Read More
Yes, it's the time we've all been waiting for?tax season!... Read More
Looking Inside Your Tenant's Mind Basic Mind-Reading Report 101 for... Read More
Larry, Moe and Curley were sitting in their favorite restaurant... Read More
Non-indexed mutual funds try to keep it secret that actively... Read More
Let's first understand what maniac means. According to Webster a... Read More
Pre-1933 Gold Outperforms Today's Gold Bullion...Since 1970, an investment strategy... Read More
To create momentum in your options trading you need to... Read More
The following lists of questions are suggested questions to ask... Read More
This column has often focused on intangible investments like stocks... Read More
Jim Miller is a registered investment advisor. This means that... Read More
For many investors, and even some tax professionals, sorting through... Read More
Who is the SEC and why should I ask them... Read More
The perfect company - it's the holy grail of the... Read More
Investing |