LSF have they been short the right stocks in recent days

On the LSF threads many have commented on the big movements of daily NTAs. Obviously this is a worry if they are to get their calls wrong from here, given they have ramped up the gross exposures very high in terms of their limits. Although they have a net exposure of about 100% there are big bets behind the scenes.

That has led me to do a bit of scanning on what such bets might be. They don't disclose their individual shorts. We have heard about many of their long calls in presentations in recent months. Whilst these could change any minute, I am encouraged by looking at some of their movements in recent days. I was curious because their daily NTA release is always a few days stale.

The NTA report for end of May came out yesterday and they made one thing clear with their strategy. They believed the rotation out of safe havens, or expensive defensives had plenty more room to run.

One theme I think I have noticed in recent days is some of the perceived defensive areas like healthcare on the ASX has been a bit lacklustre in the strong market. Same with defensive names globally.

At the risk of getting carried away by a strong day from LSF on Friday, I am hopeful next week it can keep going based on this rotating out of defensives theme. The discount doesn't seem to want to go much below 22% in recent months but maybe that is about to change. (Friday’s move only really made up for a poor day before and reflective of a great last NTA update).

If you judge them by the longer time period of their long /short unlisted fund, or even their long only fund (since 2007), it is hard to be too critical. Admittedly though the volatility has been crazy since they launched their LIC, which just happened to on the eve of their shocking run.

Just not sure if they might be short some of the ASX banks, maybe that might slow any growth in the next few NTA releases? On balance I think next week looks very promising if wall st consolidates last nights bumper session.