** $2bln long/short equity manager Mitchell Capital isrunning its short book at a historic low of 10 pct, warns of thedangers of betting against recovery despite continuing weaknessin Europe.
** Poor macro data luring investors into "dangerous" game ofshorting Europe, founder Stuart Mitchell says.
** Cut short position from 40 pct to 10 pct in 2011,believes European recovery still to unfold.
** "We think it is too early to add to our short book: it isa dangerous game at the moment as we think the recovery has notyet played out," he says.
** Running overweight long position in financials,comprising around 30 pct of the portfolio, despite fallsfollowing the ECB's stress tests.
** Top ten holdings include Lloyds, Intesa Sanpaolo and Banco Popular.
** "We are heavily exposed to cyclicals, that generallytrade at a discount to their US counterparts," he says.
(RM: alasdair.pal.thomsonreuters.com@reuters.net)
Lloyds (LLOY)