The chart below displays the price of long HLF and short JCP…the opposite of Mr. Ackman. Over the last few trading days, the price of the pair has nearly doubled, meaning pain for Mr. Ackman, but the billionaire is probably not very concerned with day-to-day fluctuation, for according to his analysis, there are structural and fundamental drivers behind the trade…high conviction.
Some folks, like Carl Icahn, smell the potential for a short squeeze in HLF. Mr. Icahn, who goes way back with Mr. Ackman, has taken the other side of the HLF trade. Additionally, JCP may be a way to watch HLF too, for the two have seemed to have an inverse relationship. Either way, this Wall Street drama is far from over.
HLF-JCP Displayed below.
