Dan Loeb's Third Point Shows Lehman Brothers as a Top Position ~ market folly

Wednesday, November 2, 2011

Dan Loeb's Third Point Shows Lehman Brothers as a Top Position

Dan Loeb's hedge fund Third Point updated investors on their latest holdings and exposures for the end of October. Third Point lists Lehman Brothers Holdings as a top position this month, one that previously has not appeared in the upper echelon of their portfolio.

Third Point's Top Positions

1. Yahoo! (YHOO)
2. Gold
3. Delphi Corp
4. Lehman Brothers Holdings
5. Sara Lee (SLE)

Also worth noting is that Sara Lee has taken the place of Technicolor from last month as their fifth largest stake. The company recently sold its North American coffee business, something the hedge fund anticipated when we highlighted Third Point's Sara Lee investment thesis.

Third Point's top three positions remain unchanged from last month. You can view Loeb's bull case for YHOO here.

Increased Equities Exposure

Third Point was up 0.8% in October and 0.9% for the year at that time. Equities rallied furiously in October as the S&P 500 was up 10.9% and last month it seems Loeb's firm was hurt by their low net exposure which we've highlighted previously.

And speaking of exposure, Third Point did increase their net long position in equities to 22.9%, up from 15.6% net long the month prior. They have their largest net long exposure to the technology and energy sectors.

In credit, they are 18.4% net long as they continue to have their largest net long exposure in asset backed securities and continue to be net short government issues. Their overall net long exposure in credit increased 2.8% from last month.

Geographically speaking, Third Point is net long the Americas by 57%, net short EMEA at -5% and net short Asia at -2%.

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