Andrew Feldstein, who bet against JPMorgan Chase & Co. before helping the bank unwind more than $20 billion of trades, has
emerged as one of the biggest winners among hedge-fund managers profiting from
a flawed strategy, Bloomberg reports.
The $4.3 billion flagship fund of Feldstein’s BlueMountain
Capital Management LLC returned 9.5 percent this year through June 22,
according to a person familiar with the data. That’s up from the 5.4 percent
return before JPMorgan announced a $2 billion loss by one of its traders known
as the London Whale. BlueMountain, which was on the other side of those wagers,
stands to make as much as $300 million, said market participants familiar with
the trades.
Feldstein, a former JPMorgan executive who helped the
company create the credit-derivatives market, profited by exploiting price
distortions caused by the outsized bets and then aiding the bank in unwinding
the trades as it sought to cap the loss, according to four people with
knowledge of the strategy who asked not to be identified because the matter is
private. BlueMountain enabled JPMorgan to unload more than $20 billion of bets
on a credit-swaps index, two of the people said.
More? Go to http://www.bloomberg.com/news/2012-07-02/ex-jpmorgan-trader-feldstein-biggest-winner-betting-against-bank.html
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