Hedge Fund Tracking: Whitney Tilson's T2 Partners - 13F Filing 3rd Quarter 2008 ~ market folly

Sunday, November 16, 2008

Hedge Fund Tracking: Whitney Tilson's T2 Partners - 13F Filing 3rd Quarter 2008

(Note: Before reading this update, make sure you check out the preface to the series we're doing on Hedge Fund 13F's here).

Well, here we are again, right back in the swing of things. This is the 3rd Quarter 2008 edition of our ongoing hedge fund tracking series. We'll be bringing you the long side of the portfolios of numerous prominent hedge funds. Hedge funds we track here at MarketFolly.com include: Tudor Investment Corp, Maverick Capital, Greenlight Capital, Blue Ridge Capital, Moore Capital Management, Lone Pine Capital, and literally many, many more. We're aiming to cover 35 or so prominent funds this time around and we'll be releasing the 13f analysis here in the coming weeks on each individual fund.

First up in the 3rd quarter edition of our 2008 hedge fund tracking series is T2 Partners. T2, as of the current filing, is a $132 million value fund ran by Whitney Tilson. In addition to running his fund, Tilson is very active in the value investing community, releasing his Value Investor Insight newsletter and organizing the Value Investing Congress, which we covered a few weeks earlier. We also recently covered Tilson's latest thoughts on this volatile market here.

Tilson launched his investment career in 1999. Taken from his Tilson Funds website, "Mr. Tilson received an MBA with High Distinction from the Harvard Business School, where he was elected a Baker Scholar (top 5% of class), and graduated magna cum laude from Harvard College, with a bachelor’s degree in Government. Mr. Tilson writes a regular column on value investing for the Financial Times and Kiplinger's, has written for the Motley Fool and TheStreet.com, and teaches financial statement analysis and business valuation for the Dickie Group. He was one of five investors included in SmartMoney’s Power 30, and was named by Institutional Investor as one of 20 Rising Stars."

So, now that we've got a background on Tilson and T2, let's take a quick look at his portfolio highlights. Keep in mind that this is merely a brief summary of T2's top holdings. Due to the time sensitive nature of the 13F material, we wanted to get this information posted as soon as possible. The following were T2 Partners holdings as of September 30th, 2008 as filed with the SEC.

New Positions (Brand new positions that T2 initiated over the past quarter)
Contango Oil & Gas (MCF)
Goldman Sachs (GS)
Atlas Pipeline Partners (APL)
Anheuser Busch (BUD)
GHL Acquisition Corp (GHQ)
Chesapeake Energy (CHK)
Research in Motion (RIMM)
Annaly Capital Management (NLY)
Fannie Mae (FNM)
Chipotle (CMG-B)
Premier Exhibitions (PRXI)

Removed Positions (Positions T2 sold out of completely last quarter):
Birthday Chocolates (BDAY)
Jamba (JMBA)
American Italian Pasta (AITP)
Ebay (EBAY)
Whole Foods (WFMI)
ATP Oil & Gas (ATPG)
Hennessy Advisors (HNNA)
Clearpoint Business Resources (CPBR)
Starbucks (SBUX)
Kinross Gold (KGC)
Universal Stainless & Alloy Products (USAP)

Top 20 Holdings (based on % of portfolio):

  1. Fairfax Financial (FFH) - 19% of portfolio
  2. Resource America (REXI) - 7.8% of portfolio
  3. Winn Dixie Stores (WINN) - 7.1% of portfolio
  4. Berkshire Hathaway (BRK.B) - 6.9% of portfolio
  5. Borders (BGP) - 6.3% of portfolio
  6. Echostar (SATS) - 5.7% of portfolio
  7. Delia's (DLIA) - 5.6% of portfolio
  8. EMC Corp (EMC) - 4.7% of portfolio
  9. Barnes & Noble (BKS) - 4.3% of portfolio
  10. Contango Oil & Gas (MCF) - 3.9% of portfolio
  11. Goldman Sachs (GS) - 3.1% of portfolio
  12. Target (TGT) - 2.8% of portfolio
  13. Sears Holding (SHLD) - 2.4% of portfolio
  14. Weyco Group (WEYS) - 2.1% of portfolio
  15. Winthrop Realty (FUR) - 1.7% of portfolio
  16. Odyssey Re Holdings (ORH) - 1.7% of portfolio
  17. Berkshire Hathaway (BRK.A) - 1.5% of portfolio
  18. Greenlight Capital RE (GLRE) - 1.2% of portfolio
  19. Ambassadors International (AMIE) - 1% of portfolio
  20. Atlas Pipeline Partners (APL) - 0.8% of portfolio

Keep in mind that we have not detailed every tiny maneuver they have made with their portfolio. Some of the holdings they added some shares, others they sold. We are essentially capturing the major moves T2 has made over the past quarter with regards to their portfolio.

This is the first hedge fund we're covering in our 3rd quarter 2008 edition of our series of tracking 35+ prominent hedge funds. Stay tuned this week and next week as we detail the portfolio holdings of these funds. Overall, its been one of the worst years ever for hedge funds, as we noted in our recent October hedge fund performance update. So, the recent moves they've made in their portfolios become all the more interesting given the way the market has played out. Some funds we will be tracking to look forward to: David Einhorn's Greenlight Capital, Lee Ainslie's Maverick Capital, Paul Tudor Jones' Tudor Investment Corp, Louis Bacon's Moore Capital Management, and many, many more.

Lastly, make sure to check out T2 Partners' Whitney Tilson's latest thoughts on the market and check back with us at MarketFolly.com in the coming days to follow all the hedge fund portfolio holdings.

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