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Einhorn's Greenlight Fund Pares Gains With 4.9% August Decline

Hema Parmar

(Bloomberg) -- David Einhorn’s 2019 comeback lost steam in August. The main hedge fund at Greenlight Capital declined 4.9% in the month, bringing returns for the year to 15.2%.

Greenlight, which focuses on value investing, is in the midst of a resurgence following a lackluster 2017 and its worst year ever in 2018, when it plunged 34%. Client redemptions left the New York-based firm, which oversaw $12 billion at its peak, with $2.5 billion at the start of this year. Einhorn has since vowed to rework his portfolio by making fewer, more-concentrated investments.

The fund has gotten a lift as the U.S. stock market continued its rally, with the S&P 500 Index gaining 17% this year through Friday. General Motors Co., Greenlight’s largest U.S equity holding as of June 30, rose 11%. Green Brick Partners Inc., AerCap Holdings NV and Brighthouse Financial Inc., the firm’s next three biggest stock holdings at midyear, had gains of as much as 35%.

Einhorn also has been vocal about shorting Tesla Inc., and that bet has been working too. The stock is down 32% in 2019.

Not everything has gone Einhorn’s way. In a July 25 letter, Greenlight told investors that it started a “medium-sized position” in chemical maker Chemours Co. during the second quarter. The stock has fallen 41% since the end of June. The firm also disclosed small positions in Dillard’s Inc. and Scientific Games Corp, which are down 6% and 7%, respectively, in the same span.

A spokesman for Greenlight didn’t immediately respond to a request for comment late Friday.

--With assistance from Simone Foxman.

To contact the reporter on this story: Hema Parmar in New York at hparmar6@bloomberg.net

To contact the editors responsible for this story: Alan Mirabella at amirabella@bloomberg.net, Josh Friedman, David Scheer

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