Conventional investing wisdom would have you believe that anybody who has remained bearish on global markets since the financial crisis has not only lost a boatload of money, but has missed out on the opportunity to cash in on one of the most torrid bull markets in recent memory.

However, as Horseman Global’s Russell Clark has proven over and over again, this simply isn’t true. A few years back, we anointed Horseman with the title “The world’s most bearish hedge fund” for a very simple reason: Of all existing asset managers, Horseman may be the one with the biggest and longest net short position in history. Just look at the chart below, which shows not only that Clark’s net exposure was (as of March) a staggering -88.14%, with a gross short position of 160%, but that he had been effectively net short since 2011!

Yet, to assume that Clark has lost his shirt over the past ten years would be a mistake. Actually, his fund outperformed the S&P 500 for the period between 2011 – when he first went net short – to the end of 2018 (when the Q4 meltdown helped his fund post double-digit returns well above its benchmark).

In 2014, Clark posted double-digit returns when oil prices cratered (he was short). In 2013, he made money shorting Brazilian equities. He started with just $111 million when he took over the fund in January 2011, but AUM peaked at $1.5 billion in 2015.

However, the fund’s inconsistent performance (it’s not unusual for Horseman to be up or down 5% in a single month) has alienated some investors who are uncomfortable with the volatility, even as Horseman has bested most other hedge funds in terms of performance, as one former investor told Bloomberg.

Tim Ng, chief investment officer of Princeton, N.J.-based Clearbrook Global Advisors LLC, says his fund pulled its money for similar reasons. “The stretches of negative performance and the high volatility of monthly returns became a consistent drag on our portfolio’s overall return, which prompted us to redeem,” he says.

But after a bruising Q1, when Clark got crushed by the torrid rally in US equities, more LPs have pulled out, and AUM has shrunk to just $690 million. Per the FT, the loss in Horseman’s Global Fund for April was a staggering 12%, which has brought its total loss YTD to more than 25%.

This prompted Clark to joke during an interview with Bloomberg published Friday. Perhaps it was kismet that the interview was timed to coincide with stocks’ worst run since the December rout.

Because if this run doesn’t continue, Clark joked, “this could be my farewell interview.”

During the interview, Clark recounted how his contrarian views were cemented during the early days of his finance career, when he lost several weeks’ worth of pay during the dotcom crash.

Russell Clark’s entry into the high-stakes world of investing could hardly have been less promising. As a graduate trainee at UBS Group AG in Sydney, he was wowed by friends getting rich by day-trading tech stocks in 2000. So he spent his first few paychecks on five dot-com shares. Four crashed to zero, and the fifth lost half its value as the tech bubble burst.

That lesson was so brutal that it helped turn Clark, now 45, into a career contrarian. These days the hedge fund he runs for London-based Horseman Capital Management is prepared for a market crash. It’s an audacious contrast to what’s been the most popular trade in town for years: wagers that stocks will keep rising. What’s more, with a resolve virtually unheard of in the industry, he’s been betting on stock declines for more than seven years.

But as the relative market calm has been increasingly punctuated by bouts of frenzied volatility, Clark believes that the moment where the market finally breaks is nigh at hand.

The vicious December sell-off, crowded trades, low trading volume even during market rebounds – these are signals to Clark that the market is about to crack. Which for him is good news. “The stars are aligning, and the markets are complacent,” he wrote in January. “Get the popcorn ready, it’s showtime.”

Clark’s assiduously dedicated contrarianism has earned him a cult following among professional investors. Though his name isn’t as widely known as an Ackman or a Loeb, his interview with RealVision was one of the company’s most requested videos from 2018 (RV recently released the interview in its entirety for free).

Despite a wave of redemptions in 2016, 2017 and 2018, Clark, who keeps the bulk of his own wealth in Horseman, has retained an unflappable confidence in his investing view.

“When people hate you and write terrible things about you, it tends to be the best time to invest.”

Those who have opted to stick with Clark have probably developed an admiration for his contrarian calls, and accepted the fact tha the fund “lives and dies” with his macro view……more here