Millions of dollars may have been knocked off the paper fortunes of billionaires, but there’s some family offices that are cashing in from the turmoil unleashed by Brexit. Look no further than the former hedge funds that have been converted into family offices to see who’s making serious money.
Those family offices that took short positions on European bank stocks and sterling before the UK referendum on June 23 have been big winners. These include George Soros, whose family office, Soros Fund Management, shorted shares in Deutsche Bank last Friday, according to a regulatory filing. Deutsche Bank’s share price fell rapidly on Friday, at one point by 13% from its high. The chart below shows the sudden dip in its share price.
Conversely, those family offices that took long positions in Japanese yen and gold also did well. This includes Stanley Druckenmiller’s Duquesne Family Office, which, according to sources, went long on gold futures before the Brexit vote. The chart below shows just how well the price of gold did after the vote.
One London-based family office chief investment officer, who wanted to remain anonymous, said many family offices would have taken market positions on the outcome of the Brexit vote. “Most would have hedged their positions against the possibility of a leave vote, but I’ve heard a few stories of investors going long on sterling on the basis of the Remain (in the European Union) vote winning.”