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Billionaire fund manager Jeffrey Gundlach recommended on Monday that investors short Facebook amid rising concerns about federal regulation and bet on energy.

Jeffrey Gundlach, CEO of DoubleLine Capital LP, presents during the 2018 Sohn Investment Conference in New York City, U.S., April 23, 2018. (Reuters)


Billionaire fund manager Jeffrey Gundlach recommended on Monday that investors short Facebook amid rising concerns about federal regulation and bet on energy.

Facebook shares have fallen more than 10% after revelations that British data firm Cambridge Analytica misused the personal data of as many as 87 million of the social network’s users. In the days after the data breach became public, Facebook CEO Mark Zuckerberg answered questions from both chambers of Congress and said he saw federal regulation of internet giants as “inevitable.”

“Equity bubbles pop by regulation,” Gundlach said while speaking at the Ira Sohn investment conference in New York, according to Fortune. Gundlach added that Facebook’s base of 2.2 billion users could be seen as “2.2 billion compliance breaches.”

He said he would pair a short position on Facebook with a long stance on the SPDR Oil & Gas Exploration ETF, Bloomberg reported.

Gundlach, 58, is best known as the founder of investment firm DoubleLine Capital. He has a history of betting against top tech stocks, previously advising investors in 2012 to sell Apple shares just before they plummeted from above $600 to below $400. Concerns about rising inflation and Federal Reserve interest rate hikes have rattled the markets in recent months.

Commodities, Gundlach noted, tend to perform well when the economy struggles.

“Some people think inflation should not rise going into a recession, but actually the opposite is true,” Gundlach said. “One should expect that as the next recession approaches, commodities should have a big gain.”


By Fox Business
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