#1 find stock with low volume, not too liquid. #2 start short position. #3 get on the news/internet and tell them you are shorting the stock and why. #4 cover short position on stock price drop due to media coverage/panic, get hailed as genius fund manager for predicting the future. #5 profit. ala Pershing Square Capital Management.
Unfortunately its true. Guys like Einhorn make money and SEC cant do anything. billionares are going richer... Only option is to go long during crash to get cheap shares
I understand your cynicism, however, if the reasons for the short position do not "stack up", then the price drop described in number 4 may not happen. Or alternatively, it may happen the first one or two times, but then after that, it stops working. Ultimately the analysis does matter, and the drop in HLF since yesterday indicates that people are listening to Ackman's idea.
Ackman is donating 100% of his HLF short profits to charity. But I do agree about the part where some HF managers are hailed as brilliant when all some of them did was take massive bets with other peoples money (Paulson in 2008). Too bad Paulson didn't retire as a legend cause the guy has been getting crushed over the last few years (actually, his investors are the ones getting crushed). So much for his brilliance.