Before David Einhorn, there was Jim Chanos. Chanos made a name for himself with his short calls, most notably on the fall on Enron. Today he manages $6 billion for Kynikos Associates, the firm he founded in 1985.
Chanos' pronouncements haven't had the same immediate, destabilizing effect on a stock as Einhorn's, yet investors following his 2011 calls would have cashed in.
In last year's presentation, entitled "Beware the Global Value Trap," Chanos called out ExxonMobil (XOM), GameStop (GME), for-profit college ITT Educational Services (ESI) and Brazilian iron company Vale (VALE) as stocks that have been deemed value investments but shouldn't be. He cited faulty metrics, over-dependence on one product, and lack of technological advancement as reasons for shunning them.
With the exception of Exxon, Chanos' other three picks -- ITT, Vale, and GameStop -- have all run into headwinds since last year's conference. A drop in student enrollment has hurt ITT, Vale has had to contend with falling iron ore prices and GameStop continues to lose out on sales because of competition from online gaming.
