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Hedgies Know Something About Citi That You Don’t?

While hedge fund heavyweights continue to buy aggressively into Citi , reports out Thursday suggest the firm has experienced a surprising outflow of talent.

According to the Wall Street Journal, the departures are the latest in a parade of senior Citigroup bankers who have headed for the door in the past year and a half.

Though a number of banks are experiencing upheaval, says the Journal, the Citigroup exodus seems noteworthy, with resignations in Europe around 20 senior bankers.

Why are smart people buying Citi when the smartest traders are leaving?

I think hedge funds that are adding to their positions in Citi aren’t thinking about it as a long term investment, explains veteran trader Gary Kaminksy. They’re not going to hold it for 3-5 years.

They’re thinking if Citi can get over $5 share the plain vanilla institutions that are significantly underweight are going to buy it. That’s would be good for 20% even 30% upside. It’s opportunist.




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