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"You Can Believe Me Or You Can Believe The Wall Street Journal": Ray Dalio Denies He Is Be

• Zero Hedge - Tyler Durden

Update: After sparking much apocalyptic speculation following the previously reported WSJ article according to which Bridgewater has a $1.5 billion short position on the S&P which implies a sharp market drop before March 2020, the fund's founder, Co-Chairman and Co-CIO has come out refuting the WSJ article.

In a LinkedIn post published shortly before noon, Dalio published a brief LinkedIn comment in which he claims that the WSJ article's conclusion that Bridgewater is betting on a market drop is "wrong", and wants to "make clear that we don't have any such net bet that the stock market will fall." He then pulls a page out of every Wall Street prop desk, and certainly that of the JPMorgan whale, in which he says that "we don't have any such net bet that the stock market will fall. We explained to Juliet Chung, the author of the article, that to convey us having a bearish view of the stock market would be misleading, but it was done anyway."

What Dalio is in effect saying is that the short position is merely a hedge to its existing portfolio, which of course, is the same "explanation" that Wall Street prop desks used over and over for the past few years when they were banned from taking pure directional trades, and as a result, were forced to justify any positions as "hedges" to other positions, with the London Whale's IG9 fiasco coming to mind most notably. 

Of course, it is impossible to glean just what is the underlying thesis behind any one trade, which also explains why Dalio was especially careful to state that he does not have a "net" bet that the market will fall. Well, perhaps it's not net. Perhaps it's just a standalone bearish position to offset the fund's other bullish position which Bridgewater is too big to simply unwind without spooking the broader market.


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