Cliff Asness vows not to fight 'morons' over AMC short... but does anyway - Citywire USA

‘I dare all meme-stock maniacs to try to hurt us.’

Cliff Asness knows how to throw down the gauntlet, as the quant specialist announced he had a small short position in cinema chain AMC, which was at the forefront of the so-called meme-stock rally in 2020.

Speaking on CNBC’s Closing Bell, Asness, the founder of AQR, said he had opened minor shorts in his systematic funds, which account for around 12 basis points, as the stock was trading with ‘terrible’ price, profitability, high beta and volatility.

AMC had been chosen as a prominent pick among Reddit users, perhaps second only to GameStop in prominence in 2020, when many retail investors drove the price of the stock higher in an attempt to squeeze short sellers.

During his interview with CNBC, Asness said he would ‘not notice’ the meme-stock traders and that the positions would only be minor. However, in the hours following the interview, he was drawn into several arguments with Twitter users who either defended AMC or criticized his position. Despite vowing not to argue with these Twitter users, Asness did anyway.

He also said that many of those in the meme-stock trading arena had similarities with the people who raided the US Capitol building on 6 January 2021.

He tweeted:

‘Having antagonized the “stonks” crowd with an example of a TINY position of ours, I am struck by the similarities between them and the “stop the steal” maniacs. No facts matter. Pure fever swamp lies, conspiracy theories, and paranoia. All with a cult-like support group. Scary.’

This drew further ire from his critics, some of whom argued that AQR would lose client as a result of Asness’s stance, a suggestion he was quick to dismiss. He wrote:

‘I may lose clients for engaging with you morons (I hope not; it’s just passion, people) as that’s pretty dumb of me, but I will lose zero clients for saying the election was not stolen and Jan 6th was a blight on this country. Zero. I may get inflows from it. Thanks for your input.’

Asness was also asked to increase his short position if he really believed in it. However, he said the position was technically 1,500 holdings across an array of quant portfolios and that this showed a lack of understanding from some quarters of the retail market.

He explained:

‘I have tremendous respect for retail investors who’ve done their homework and invest well. I do not have respect for idiots with laser eyes talking about “stonks” and calling themselves “apes” who are PROUD they don’t know anything. It’s a subtle distinction, sorry to confuse.’

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