13F

With Paulson's star long gone down, there are few remaining "new generation" hedge fund wunderkinds, especially in a world in which the best performing hedge fund is Federal Reserve Capital LLC - Onshore Fund. One among them is Third Point's Dan Loeb, who continues to be one of the best performing hedge fund managers for the 4th year in a row. He just filed his Q1 13F, amounting to $5.3 billion in disclosed long equity positions, which are summarized below. Of note are the following changes:

• New stakes in Virgin Media ($538MM), Tiffany ($188MM), Anadarko ($105MM), Thermo Fisher ($99MM), Cabot Oil and Gas ($84MM), Hess ($72MM) and others. Some of these overlap with the initiations of David Tepper and David Einhorn especially Hess: did some "idea dinners" take place in Q1 we were not aware of?
• Fully exited stakes in Tesoro, Morgan Stanley, Nexen, Symantec, Herbalife, Illumina, Coke, PVH, Abbott Labs and others.
• Reduced positions in Yahoo, AIG, New Corp, Murphy Oil, Delphi, Lyondell and others
• Added to stakes in International Paper, Abbvie, Dollar General, Constellation, and Ariad

Back in September 2010, following David Tepper's first "balls to the wall" appearance on CNBC, we were not very surprised to learn that the seemingly permabullish hedge fund manager had taken the opportunity to follow up on the brief euphoria his speech generated then to cut 20% of his positions in assorted financial stocks - just the stocks he was praising loud and clear to the financial station with the plunging viewership.  Moments ago, Tepper's Appaloosa filed its 13F for the quarter ended March 31, so yes, before his most recent appearance yesterday. Yet we were somewhat confused by why the manager, once again so bullish he could see no scenario that could send stocks lower, and who estimated a war in the middle east could lead to a mindblowing 5% drop in the market, decided to trim his core holdings.

Back in 2012, amid "intense pressure from Obama" including an appeal for its passage in his 2012 State of the Union address, Congress passed the Stop Trading on Congressional Knowledge (STOCK) Act (with 96-3 theatrical votes in the Senate, and 417-2 even more theatrical votes in the House) - a bill prohibiting the use of non-public information for private profit, including insider trading by members of Congress and other government employees. It is unclear why until 2012 it was perfectly legal for congress to trade on inside information, something we pointed out in May 2011 when we wrote that a "A Hedge Fund Comprised Of Junior Congressional Democrats Should Outperform The Market By 9%" as it turned out flagrant insider trading abuse occurred mostly within the democrat ranks of the House (compared to a mere 2%+ outperformance by Congressional stock trading republicans). It turns out that any cynical skepticism regarding Congress' ability and willingness to police itself was well founded, as last night the House eliminated a "key requirement of the insider trading law for most federal employees, passing legislation exempting these workers, including congressional staff, from a rule scheduled to take effect next week that mandated online posting of financial transactions."

As we warned on December 26, when the stock was trading in the mid 20's the pain for shorts is horrible and getting worse (courtesy of the best and always absolutely certain contrarian signal - the involvement of Whitney Tilson) and is about to send the stock into the stratosphere following a very surprising announcement by none other than Bill Ackman buddy Dan Loeb, who just filed a 13F reporting a 8.24% passive stake in Herbalife sending the stock surging. In other news: this may be Herbadeath for Whitney Tilson, who may well be on track to blow up a second fund in under a year.

Back in May, Herbalife stock got monkeyhammered when one of the best performing hedge fund managers of the past few years, David Einhorn expressed a bearish thesis in the company. Today, the stock just got the double tap following no new information, but merely the second part of the Einhorn-Ackman-Loeb activist triangle (who most of the time operate as an informal cartel), as it plunged by over 10% when William Ackman, smarting from the hundreds of millions lost in JCPenney just piggybacked on Einhorn's thesis, as reported by CNBC, said he is short Herbalife, calling it a pyramid scheme, and saying he has done fundamental research for a year (it takes a year to read Einhorn's presentation?). Essentially, nothing new here. All we await now is that 13F chaser Whitney Tilson to finally jump on board what is becoming the world's biggest hedge fund short, and get a catalyst, any catalyst that scrambles the shorts into covering, and sends the stock in the triple digit range.

It is no secret that for many years the SEC has been looking into ways of taking down the most infamous of all "information arbitrage" abusing hedge funds: Steve Cohen's SAC Capital, a quest that has finally accelerated to its inevitable terminal point weeks ago. Of course, had the SEC been reading Zero Hedge, the time to get to that critical civilian conviction would have been far shorter. But where the SEC was demonstrating ongoing incompetence, its peer organization - one with all-important criminal enforcement powers - the FBI, was actually several steps ahead, and as Bloomberg reports, is now probing specific trades by SAC, a process which very likely will culminate with criminal charges against one or more people not at CR Intrinsic, but SAC itself. Of course, by several steps ahead, we do mean two years behind Zero Hedge.

Once upon a time Diamondback was one of the most prestigious, most desired to work for hedge funds. That is no longer the case, because as Bloomberg reported moments ago, the Stamford, CT-based fund, which as recently as 2010 had nearly $6 billion in AUM, is closing down, due to concerns it could be the next SAC, and following a flurry of redemptions, has no choice but to liquidate. What equities will be dumped wholesale by the fund? Full list of top 30 holdings is presented below.

With the star (and legend) of John Paulson long dead and buried, and his Disadvantage Minus fund an embarrassment, wrapped in a monkeyhammering, inside a humiliation, there are few "groupied" HF managers left. One of them is Dan Loeb, who still manages to generate positive Alpha regardless of how Beta does, another one used to be William Ackman (not so much anymore, especially not with the whole JCP fiasco), some others are David Tepper, Seth Klarman, and a few others, but nobody has quite the persistent clout and following of young master, and poker maestro, David Einhorn, and his fund Greenlight. Below we breakdown his latest just released 13F, which as a reminder shows, his holdings as of September 30. Key changes: Einhorn cut his holdings in Best Buy, Carefusion, Compuware, Expedia, Hess and UnitedHealth, and started new, small, positions in Yahoo, Babcock and Wilcox, Aecon and Knight Capital. More importantly, he cut his top position, Apple, by nearly 30% from 1.45 million to 1.09 million shares, cut modestly his second biggest position Seagate, added materially to GM, making it his third position, added to Cigna at #4 and added modestly to the GDX Gold Miners ETF. Sad to say, unless he has changed his portfolio dramatically since September 30, Einhorn is likely not doing too hot, especially in the last week or two.

Just when we thought blowing up one fund in one year is enough for Whitney Tilson (recall from July: It's Official: T1 Is Not T2; Tilson Liquidates To Buy More Of The Same), we got a glimpse of his just released 13F and are rather confident the man, the myth, the stuff of Anti-Tilson ETFs will shock and awe us all one more time. The reason? As of September 30, Tilson's inaccurately named T2 Partners - it should be T1 now that Glenn Tongue is long gone - had a total of $175 million in AUM. That's not the punchline: as part of this $175 million, Tilson had $63 million in put/call stock equivalents. In other words the much vaunted "asset manager" who for some absolutely inexplicable reason continues to get CNBC airtime, managed a grand total of $110 million in real (mostly family and friends) money. That's not the punchline either. The punchline is that Tilson's top 3 positions were AIG and AAPL, with AIG in both stock and Call format. In fact, more than 10% of the firm's virtual AUM, or $18.6 million was in stock equivalent calls for AIG and AAPL, stocks which since September 30 have gone in a literally, not virtually, straight line lower, and have as a result likely wiped out the entire intrinsic call value. The only silver lining: Tilson owned $5.5 mm in NFLX calls and a grand total of $3.6 million in NFLX stock. We hope it carries him far, because once the Icahn grand jig is up, in which the raider is exposed as having absolutely no intentions of buying the company, or even putting it in play, but merely squeezing the shorts courtesy of a costless collar and a sternly worded 13D, that will be the final straw for Tilson's second coming, and most likely, his career.

Unlike Dan Loeb, David Einhorn did a far more calculated portfolio reshuffle in the three months of Q2, purging only 6 positions among which RIM, CA, Dell, HCA, the GDXJ Junior Gold Miners ETF, and Roundys. He appears to have also hired a new healthcare/insurance analyst after adding positions in Cigna, Coventry Health, UnitedHealth, Humana, Wellpoint, as well as Einstein Noah Restaurants, Virgin Media, Hess, Chipotle, Genworth and some Oaktree bonds. His top 5 positions are Apple, Seagate, Microsoft, Marvell Tech and Cigna. Overall, it does not appear as if he has had a major shift in perspective on the economy. Total reported long equity AUM as of June 30 was $6.4 billion.

In Q2 Dan Loeb went to town to his holdings as of March 31. Of his roughly 38 different positions, Loeb cut 24 names to zero among which Cisco, Marvell Technology, Sara Lee, Google, Wells Fargo (with the Octogenarian of Omaha likely buying every share), El Paso, Abercrobmie, Goldman and many others. Of course, he kept his stake in Yahoo and added to Apple, while cutting his Delphi stake from 13.34 million shares to 11.5 million. He used the proceeds from these sales to add to new positions (latest 13F here) in new names such aws AIG, Aetna, Chesapeake, Cigna, Coca Cola, Enphase, Humana, News Corp, and Unitedhealth Group. Also, Loeb went quite optically against Bill Ackman and bought a $6.5 million share equivalent put in JCPenney. He is significantly in the money in this.  Altogether, his disclosed equity stake was at $3.3 billion as of June 30, down from $4.1 billion at March 31. Dry powder? Or more likely getting more into bonds (which he doesn't have to disclose on any filing).

From the inbox: "Tilson splitting from Tongue, unwinding T2 Partners, new fund at KASE Capital" We very much hope our tipster is wrong: after all how will CNBC Fast Money viewers know to buy JCP at $27, and $26, and $25, and $24, and all the way down to $19 where it is today. Also who could have possibly foreseen the end of a mega long-biased end of a $345 Million fund which had over $125 million in long derivative equivalents? Oh wait...

Here are some of the things that David Einhorn likes and does not like, having just started his speech at the Ira Sohn Conference:

• Martin Marietta - stock plunges 10% and triggers circuit breaker.
• France - "a french default is not out of the question" - France not limit down yet. He says that a return to the Franc is not out of the question.
• Einhorn likes GJF.NO - "Norway is the only country which can finance itself."
• Einhorn likes Cairn Energy as it trades at discount to assets in just Britain and India.
• Says China is misunderstood and is not an investment opportunity: not enough money to feed the economy and banks aare becoming illquid; money is leaving the country
• Also does not like Japan for all the usual Kyle Bass and Andy Xie reasons. The Yen will continue strengthening.
• Einhorn likes AMZN, calls it "elephant in the room", but questions profit growth.
• Einhorn likes Dena Co, and Gree Inc in Japan
• Einhorn is short DKS
• Einhorn, who is long about $870MM AAPL as per last night's 13F, likes AAPL. Stunner.

Sometimes, when one desperately chases alpha at any cost, all one needs to see is a somewhat credible asset manager, in this case Bill Ackman's Pershing Square, invest a massive amount of cash in a given company, to decide to invest alongside. In this case the company is JCPenney, and the amount in question invested by Ackman being $1.3 billion (at last check his third biggest positions after GGP and CP). Usually this strategy, elsewhere known as herding, 13F chasing, or alphacloning, works, until it doesn't. In the case of JCPenney it just didn't, after the company just blew up in real time dropping a tape bomb, missing on the top and the bottom, cutting the forecast, and for good measure also eliminating the dividend. End result: Ackman just lost nearly $200 million after the stock imploded by nearly 15% after hours, and all those who blindly piggybacked along without doing their homework (such as Whtiney Tilson whose 4th largest cash position is JCP), went for the ride.

For all the totally inexplicable facetime T2's Whitney Tilson gets on prime time financial comedy air, one would imagine that the man runs billions and billions. Instead, as per the just released 13F, Tilson's fund has a grand total of $345MM in long AUM as of March 31. So far so good, however that does not explain why the manager has a Sharpe ratio of roughly 0.00 in the past 3 years. Well, now we know: of the $345 MM total, a ridiculous $104 Million is in call options! In other words, not only is Tilson nothing but a bullish bet that copycats various other select hedge fund portfolios, it is a mega-levered one at that, with what appears ridiculously high theta! It get's worse: as it turns out, another $24MM or so is... in Warrants. Yup: all levered products without actually owning the underlying, leading to massive monthly swings in actual P&L. In other words, real assets held by Tilson amount to $217 Million. And one wonders why the fund can be up 20% one month and down 30% the next... or how Tilson can spend hours a day on TV.