(Bloomberg) — Short seller Russell Clark, who had surrendered to a raging bull market about three years ago, is ending his retirement to start a hedge fund again, hoping to profit from the market chaos sparked by Trump’s re-election.
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London-based Clark is in talks with investors to raise capital for his hedge fund that will trade stocks and bonds based on his macro views of the world. He is setting up Brumby Capital, named after a breed of wild Australian horse, and expects to start trading as soon as next month, Clark said in an interview.
His comeback coincides with a rapidly changing outlook for risk assets that has sparked losses at some of the biggest hedge funds in the world. President Donald Trump’s moves to rewrite the rules of global trade by imposing tariffs on allies and strategic rivals have sparked a ferocious sell off in stocks, while bond yields and the price of gold have risen as investors grow increasingly concerned about economic fragility.
“Trump has really blown things apart,” Clark, 50, told Bloomberg News in the interview. “We’re probably going to see Trump’s reelection as a sort of cyclical, secular top to asset markets, at least in the US.”
With rising tariffs, the re-militarization of both Europe and Japan, constrained tax bases, and structural inflation in the system, Clark believes capital is destined to become scarce again and interest rates will likely rise much higher than current levels.
“I’ll mainly be short US assets because it’s the US that’s gonna really struggle,” he said.
Being long China technology stocks and shorting their US counterparts has rewarded investors this year and remains attractive given China has supported the industry politically and the US has shown a new affinity for tariffs and a disdain for close allies, Clark wrote in a Substack post on Friday.
Still, he argued, trades such as being long gold and short the S&P 500 and US treasuries make more sense.
Before shutting down his hedge fund in 2021, Clark was one of the last short sellers left in the industry who was willing to make such bets amid a market that showed no sign of weakness as central banks continued their easy money policies.
Born and raised in Canberra, Australia, Clark famously bet against stocks for much of the past decade and generated positive returns in most of those years. His decision to shut the fund in 2021 followed a 2.6% decline in the first ten months of that year with assets down to about $200 million from a peak of $1.7 billion in 2015.
