Gundlach: DoubleLine sold its European equities late Thursday
By Jennifer Ablan
NEW YORK (Reuters) - Jeffrey Gundlach, chief executive of DoubleLine Capital, said on Friday his firm sold all of its European equities holdings before the market closed on Thursday, following a strong rally in global stocks.
Gundlach, who oversees $100 billion at Los Angeles-based DoubleLine, said the firm bought beaten-down European stocks a week ago and exited its position late Thursday because "basically I thought it was free money when I bought them and we sold into the huge rally Thursday."
MSCI's 46-country All World index rose 1.36 percent on Thursday to a two-week high.
On Friday, however, world stocks fell than $2 trillion in value as Britain's vote to leave the European Union triggered 5 percent to 10 percent declines across Europe's biggest bourses and a record plunge for sterling.
Gundlach, who insisted for months that Britain would "Bremain" in the European Union, said about the Brexit vote: "Yes, I am surprised. It suggests the public mood for change is even greater than I thought."
Gundlach, who manages the $60.3 billion DoubleLine Total Return Bond Fund DBLTX.O, had asserted that polls reflect people's complaints and frustrations rather than the actions they will actually take. "When it comes up for a vote, I think it will fail," he said last week.
All told, Gundlach said about his purchase last week of European equities: "That was the shortest hold of my life."
The DoubleLine Total Return has returned 2.53 percent year-to-date, trailing the benchmark Barclays Aggregate, which has posted returns of 4.15 percent for the same period. Continued...