Coatue Management Discloses Stake in ETrade (ETFC) ~ market folly

Monday, August 3, 2009

Coatue Management Discloses Stake in ETrade (ETFC)

In a 13G filing made with the SEC late last week, Coatue Management has disclosed a 5.03% ownership stake in E*Trade Financial (ETFC) and they own 56,057,572 shares. This is a brand new position for them, as they did not show a holding in ETFC as per their last 13F filing which disclosed positions as of March 31st, 2009.

While we don't usually cover Coatue here on Market Folly, we wanted to highlight this filing as we came across it while reading some other SEC activity. Longer term readers will already know that ETrade's largest shareholder is none other than Ken Griffin's hedge fund Citadel Investment Group. So, it looks like ol' Ken has some company in this position now. We're keeping tabs on this since it's a pretty large position for them and they had a rough year in 2008. But, they seem to have bounced back as they are up 32% as of the end of June (noted in our hedge fund performance update post).

E*Trade recently offered $600 million worth of shares at a price of $1.10 per share. As of last Friday, ETrade was trading around $1.50. Taken from Google Finance, ETrade is "a financial services company, that provides online brokerage and related products and services primarily to individual retail investors, under the brand E*TRADE Financial. The Company’s products and services include investor-focused banking primarily sweep deposits and savings products and asset gathering."

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