Swiss policy makers rarely state outright that they’ve intervened, and analysts use data on sight deposits and foreign currency reserves to gauge the scope of the central bank’s actions. Breaking with the usual protocol, Jordan said in June the SNB had acted to stabilize the franc amid the Greek debt crisis. The bottom line: CHF86.1 billion spent on FX intervention in 2015 and a whopping $470 billion since 2010.
This post is divided in two clear parts. The first one shows what according to the latest set of 13F filings, were the most popular stocks within the hedge fund community. In the second part we look at which hedge funds avoided the "hedge fund hotel" trap in 2015 and were the 50 top performing hedge funds of 2015.
How The Pros Do It: Tepper Added 75% To Longs After Saying "Now A Good Time To Take Money Off The Table"Submitted by Tyler Durden on 02/17/2016 12:22 -0400
Back in September, David Tepper told BBG TV that "it might be a good time to take money off the table." That's what he said. What did he do? According to his latest 13F as the market was surging in the final quarter of 2015, Tepper was busy buying. So busy in fact, that he took his total long notional exposure to $5 billion an increase of 75%, in the process adding 40% to his longs.
Having opened his position in AAPL in Q3 2013, Carl Icahn's projections, prognostications, and positioning have all lent credence (for CNBC watchers) to buying into the "no brainer" stock. However, it appears the plunge in the stock of the last few months has taken the shine of Icahn's glee as, according to his fund's latest 13F, he dumped 7 million shares (or aound 14% of his position) in Q4 2015. In addition, Greenlight's David Einhorn dumped 44% of his holding in Tim Cook's releveraging firm.
We can only hope that Burry managed to sell out of his CYH stake (and, ironically, his various bank holdings) which he held just days after the Big Short hit the theaters in December ahead of today's devastation, or there may not be a Big Short sequel.
One day after markets saw a violent return of optimism, which sent stocks around the globe and US equity futures soaring (the US was closed for President's Day) driven by terrible Japanese and Chinese economic data which in turn hinted at more central bank easing, animal spirits have cooled off despite some truly unprecedented Chinese credit numbers.
The just concluded 13-F bonanza shows that "some of the world’s top hedge fund managers scaled back their U.S. stock investments last quarter as markets tumbled." Below, courtesy of Bloomberg, is the full summary of what the most prominent hedge fund names did in Q3...
Perhaps those accusing Bridgewater of being the market-moving catalyst did have a point, because after posting a total AUM of $10.8 billion at June, this total declined by a whopping 31% to just $7.5 billion as of September 30.
"Activist Investors", the relatively new classification for corporate agitators, want you to believe that their intellectual tactics/ strategies improve both corporate governance and shareholder returns. That may be true but they also seem to be involved in another, less savory, tactic, that is, inflating their company “ownership” claims with extremely large derivatives positions as outlined in SEC disclosure filings.
Just like 13F clones end up getting burned more often than not, so too unfortunately for the Chinese copycats, an endorsement from the equity market’s savior has done nothing to ensure outsized returns. In fact, as Bloomberg adds, it was just the opposite - the stock picks have trailed the broader market. The 46 companies that reported the agency as a top 10 shareholder in the past two months lost an average 29 percent since the announcement, versus a 21 percent drop for the Shanghai Composite Index.
"The 17-year river [of reserve currency buildup and QE around the world] is no longer flowing," warns Appaloosa's David Tepper, and "turbulence" is now the norm. VIX 22 is too low - "expect surging volatility", 18x PE is too high - "margins are set to drop - I have problems with earnings growth and problems with multiples"
Simply put - "Flat stocks is not a bad place to be...unless central banks are on our side again, then every rally should be sold."
How did Tepper do in Q2? In a word: lousy. In another word: the man who recently was on CNBC pitching a 20x P/E multiple as the new normal, may have just called the market top.
If the central banks' intention was to convert "hedge" funds into what are essentially plain vanilla long-onlies (understandable in a world in which being long the most shorted names generates outsized returns year after year), they have succeeded.
Surprisingly, the flow of crude oil is still accelerating, much like the money going into crude oil funds. Three of the largest crude oil funds include USO, OIL, and UCO. UCO is unique due to the fact that it’s an exchange-traded fund that uses leverage, mostly in the form of derivatives, to correspond to twice (200%) the daily performance of its underlying benchmark, the Bloomberg WTI Crude Oil Sub-index. Many large financial institutions have large stakes in UCO and thus are still betting that crude oil can make a comeback beginning in 2015.
Based on quarterly 13F filings and estimated short positions of the equity holdings of 909 funds, BofAML calculates that hedge funds raised net exposure to a new record high of $683bn at the beginning of 3Q 2014, while reducing cash holdings to a record low of 3.5%. Gross exposure rose to 190%, or 207% if ETF positioning is considered, which is back to the 2007 peak... In other words, hedge funds have never been more bullishly positioned (just as large speculators had never been so bearishly positioned into last week's bond-short capitulation).