Money | Bear Stearns Hedge Funds Cash In on Collapse of Bear Wagering the securities firm stock would fall paid off millions By Jim O'Neill Posted Mar 20, 2008 9:25 AM CDT Copied The headquarters for JP Morgan Chase, right, and Bear Stearns, left, are shown on Monday, March 17, 2008 in New York. (AP Photo/Mark Lennihan) The epic collapse of Bear Stearns didn't mean bad news for everyone on Wall Street—several big hedge funds made a mint off it, the Wall Street Journal reports. The funds essentially placed bets that Bear would stumble, then raked in millions when the security firm's shares took a nosedive. The SEC is investigating to make sure profiteers did not have insider knowledge of the coming collapse. Most of the profits came through a process known as short-selling, and about 25% of Bear Stearns shares were sold that way—the seventh-most of any S&P 500 issue. Some of the big winners, including Harbinger, Greenlight, and Tremblant, had as long ago as last summer began placing their bets. A Tremblant investor said the firm had no special knowledge about Bear but began looking last year for "an insurance trade in case the world got ugly." Read These Next Cops: Arizona 5th graders drew up plot to 'end' a classmate. Hall of Famer Dave Parker dies Hatshepsut's statues weren't smashed due to sexism after all The DOJ just fired 3 prosecutors tied to Capitol riot criminal cases. Report an error