Hedge funds circle UK stocks as new PM Andy Burnham pledges 'new economic model'

Hedge fund short-sellers have ramped up bets against U.K.-listed stocks this year, with disclosed positions surging fivefold in the first half of 2026.Now, investors believe a policy blitz under new Prime Minister Andy Burnham could widen the opportunity set across U.K. equities on both the long and short sides of their portfolios.Burnham took office this week, promising to lead a "cost-of-living government" focused on tackling rising living expenses. In his inaugural speech on Monday, he pledged a "new economic model" for Britain, including a 10-year plan to reindustrialize the country, with housing costs and utilities affordability emerging as early key pillars of his agenda.Hedge funds say a domestic policy shake-up could fuel a raft of long and short ideas across U.K. sectors. That includes conviction bets against squeezed sectors and companies, and relative value trades that involve buying companies expected to benefit from Burnham's policies while shorting weaker businesses in the same industry."Where we are today is that there are lots of winners and losers, which is good because we want that dispersion," said Alyx Wood, chief investment officer of Kernow Asset Management. "...