Big Short 2019 - commercial edition
The largest credit-driven hedge fund in the United States has allocated 5% of its NAV (Net Asset Value) to short the commercial mortgage industry. Canyon Partners, with $23 billion under management implemented the short via structured derivatives that offer short exposure to an index of BBB- commercial real estate mortgages (the CMBX). This is essentially a bet against the US consumer.
"You've really seen the limits of monetary and fiscal policy in its ability to extend out a
long boom period." - Josh Friedman, Co-Chairman of Canyon Partners