Jim Chanos, the world's biggest short-seller, today made an appearance in the enemy camp.
Chanos, the president of Kynikos Associates, which has $6 billion invested in bearish bets on the stock market, gave a talk this morning at the Stanford Directors' College, an annual symposium at Stanford Law School for the directors of public companies.
Chanos provided some insights on what he does, areas of the market where he sees opportunity to short stocks, and how directors ought to react when the find short interest in their stocks rising. Here are a few bullet points from the talk:
- Chanos noted jokingly that he doesn't often get invited to talk to corporate directors - and that when he does, "there tends to be a battery of lawyers in the room and a stenographer." More seriously, he said part of his goal was to make it clear that shorts are neither "the evil omnipotent financial geniuses the market thinks we are on down days or the village idiots the market thinks we are on up days."
- Kynikos has 5 investment partners with a combined 160 years of experience, and 20 investment professionals in all. Chanos notes that the firm has "no opinions on interest rates, or drilling offshore, or the dollar, or the Fed." Instead, he says, "we are just looking at companies, the only place we feel we can add value." And he adds that they "delve into companies more than you would ever want to know."