Warren is 'single biggest risk for the market,' Citrone says

[NEW YORK] The rise of US presidential contender Elizabeth Warren is "the single biggest risk for the market," according to Rob Citrone, founder of hedge fund Discovery Capital Management.

"I think if Elizabeth Warren is leading the way into the February primaries, the S&P will be down 10, 15, 20 per cent," Mr Citrone said at the C4K Investors Conference in Toronto on Wednesday. "Her policies on regulation, on taxes, on a lot of different things, are substantially different than anything we've had in our country before."

Mr Citrone, who runs a macro-focused hedge fund firm with US$2.5 billion in assets, sees volatility ahead as Democrats prepare to pick a candidate to run against President Donald Trump. The growing popularity of Senator Warren, who advocates for a wealth tax, Medicare-for-all and reining in private equity, is stoking fear on Wall Street.

The markets aren't prepared for the prospect of the Democratic party's left wing gaining power, said Mr Citrone, who is a registered independent. He rarely backs presidential candidates but donated money to Republican Mitt Romney during the 2012 campaign.

Mr Citrone's comments strike a different tone from billionaire Michael Novogratz, who said at a benefit last week that his peers should "lighten up" and stop worrying so much about Mrs Warren. Mr Novogratz, the founder of cryptocurrency firm Galaxy Investment Partners, said 97 per cent of the people he knows "are really, really fearful of her" because they think she's seen as "anti-rich."

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