More Spying on Elite Funds - Part 2
A follow-up to my last comment on spying on elite funds. We begin with an article by Naked Value on Seeking Alpha, Paulson & Co.'s Biggest Buy, Biggest Sell and Top Holdings.
You'll notice that unlike Dodge and Cox, Paulson & Co sold all
their Pfizer shares, and initiated a new position in Hewlett-Packard
Paulson & Co is still betting big on gold, owning a significant
stake in SPDR Gold Trust (GLD) and expects a continued recovery, and as
such it thinks banks like Citigroup (C) will continue to benefit. The
fund also owns Anadarko Petroleum Corp (APC) and Transocean Limited
(RIG), which is the company Ontario Teachers' bet on and made a bundle on.
Are you confused? Don't be. You should be using the tools on the NASDAQ website
to slice and dice the portfolios of these elite funds. For example,
clicking on the % change in value header at the top of the fourth column
will show you Paulson & Co's new holdings (click on image to
that apart from Hewlett-Packard mentioned above, Paulson & Co made a
significant new investment in Weyerhaeuser (WY), buying up 31,700,200
shares during Q1 2011. Share prices for both companies are well off
their highs, and if the fund did their homework, these could yield
excellent returns going forward.
When analyzing 13F quarterly filings, it's important to look at new holdings, not just top holdings.
For example, looking at new holdings for Dodge and Cox which I
neglected to do in my last comment, you'll notice that they bought a
significant stake in Motorola Mobility (MMI) and Microsoft (MSFT) during
Q1 2011 (click on image to enlarge):
Let's move on to Soros Fund Management. First, start from tickerspy's hedge funds and click on Soros Fund Management which will bring you to this page.
I noticed a significant new holding in Adecoagro (AGRO), a company
which engages in the agricultural and agro-industrial businesses in
South America. I went on the NASDAQ website, typed in AGRO at the top
and then went to detailed institutional holdings which you'll find on
the left-hand side of the blue box. From there, I found Soros Fund
Management and looked into their top holdings (click on image to
Which other company from the list above caught my attention?
Dendreon (DNDN) because another well known hedge fund which is in hot
water lately, SAC Capital Advisors, owns the most shares of this biotech
firm which offers active cellular immunotherapy and small molecule
product candidates to treat various cancers.
Which other elite funds own shares of this biotech firm? Montreal's Sectoral Asset Management, one of the top healthcare funds in the world, as well as Orbimed Advisors,
another leading healthcare fund. I also noticed Citadel Advisors who
along with SAC and Farallon Capital, is among the best multi-strategy
hedge funds. I like seeing this cross-activity among elite funds.
Have a look at the top holdings of SAC Capital Advisors for Q1 2011 (click on image to enlarge):
attention to common holdings among these funds and common sector
themes. For example, in semis, Soros is invested in RF Microdevices
(RFMD), SAC Capital in Micron Technology (MU) and Citadel Advisors in
Advanced Microdevices (AMD). In networking, Soros has a big stake in
Extreme Networks (EXTR), SAC Capital in Lucent-Alcatel (LU), and Citadel
in LSI Corporation (LSI) and Cisco Systems (CSCO). Also noticed
Citadel's stake in Toll Brothers (TOL), the largest homebuilder (betting
on a recovery in housing?).
There are other common themes like
software, healthcare, medical devices, financials, business services,
energy and one of my favorites, alternative energy. But lately
alternative energy has been getting pounded. Just check out this chart
of one of my holdings, LDK Solar:
Yuck! But I know the big hedgies are accumulating positions
in this and other solars which is why I tell investors to do the same:
use these insane selloffs in solar shares to accumulate or initiate
positions and hold on for the ride of your life! (IGNORE Jim Chanos' dire predictions on China and Chinese ADRs!!! Jim has become the claptrap for big hedgies looking to spook investors.
Made a great call on Enron, will eat his shorts on China and Chinese
I'm running out
of gas so let me end by looking at the top holdings of another great
fund, Baupost Group, run by the legendary value investor, Seth Klarman.
If you want to see a concentrated portfolio, just look at the holdings
of this fund (click on image to enlarge):
of the stocks, PDL Biopharma (PDLI) caught my attention a couple of
months ago as I noticed another elite fund, Renaissance Technologies,
among the top institutional holders (click on image to enlarge):
There are many other elite funds that I've listed in the past
which are not discussed here. Increasingly, there are sector
specialists and other funds that specialize in niche strategies. The
point of the last two commentaries was to give you the tools to analyze
the holdings of these elite funds and allow you to invest more wisely by
leveraging off this information. The information is lagged, but when
elite funds are increasing their holdings of companies or initiating new
positions, it's typically because they see more upside ahead.