Do MMs report 13f positions gross or net?
if citadel has 2 pods L/S a stock (say pod 1 long $10, pod 2 short $3), does the 13f report $7 or $10?
similarly, if they are net short a stock (pod 1 long $3, pod 2 short $10), do they not need to file an F at all since they don't have net ownership? or they would file $3
Based on the most helpful WSO content, 13F filings report gross long positions only. This means:
If Citadel has two pods where:
If Citadel is net short a stock (e.g., Pod 1 long $3, Pod 2 short $10), they would still file the gross long position of $3. The net short position does not exempt them from filing; they simply report the gross long position without accounting for the short side.
In summary, 13F filings focus solely on gross long positions, regardless of net exposure or short positions.
Sources: How Does Citadel HF Make $28bn Revenue with $55bn AUM? Multi Manager Economics, Performance of the best PM’s at MM’s?, , Citadel Equities analyst terms
13F positions are on a gross long basis, so MM or not doesn't matter
Net. The mix and distribution at a pod level is irrelevant. Firm exposure is what matters.
Very helpful thread, lot of consensus here.
Always gross under Threshold A of the current reporting standards - SEC Adopts Gross Short Position and Activity Reporting by Institutional Investment Managers - Seward & Kissel LLP
The way you phrased the question is causing confusion, "gross" / "net" can be interpreted in multiple contexts.
As per your first example, the 13F would show $7 - it shows only the fund's final long positions after all the pods "net" against one another. Any position that is net short will not show up on the 13F. Keep in mind that this does not include positions on swap (short $3 and long $10 on swap will not show up on the 13F) as well as positions outside of the US. There are also more involved strategies (e.g. boxing shorts etc.) that funds can use to hide their true size.
However, the 13F shows "gross" positions ("gross" as used in GMV) in the sense that it shows the post-leverage positions of a fund - for this reason, most major funds have total position sizes that are larger than the AUM of a fund, even though you only see the long side of the book- this is because most market neutral funds operate at >2x leverage.
Don’t think that’s right… 13Fs only show gross longs. If C is long 10b of aapl and they’re short 5b then it’ll still show 10 in the 13f. More importantly,if P72 is net short 500mm of LYB, it still only shows the 50mm long (550mm short, 50 long)
5b never hits the market it is netted out internally
so the firm only actually holds 5b stock in this case and that's what they show on filings
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