Friday, November 7, 2008

Some Financial Freebies & Deals

Since we're going into the weekend, just thought I'd post up various freebies and deals I've come across over the past week or two that are finance/market related. Economy sucks right now, so some of these should be beneficial.

  • Free Quicken Online - yep, entirely free. (They used to charge $35/yr). Worth checking out for all you savvy personal finance people out there. I wrote about this deal a week or two ago and just wanted to make sure everyone took advantage of it, I know I did.
  • Free Stock Trades - If you want 10 free trades a month, even for retirement accounts, then check out Zecco. Its great for building core positions over the long-term. If you think about it, 10 trades a month at other brokers would normally cost you $40-70 per month in commissions, so you just saved that money. They recently had no commissions for the entire month of October, which I wrote about here.
  • Get $100 bonus at ForexClub. Those of you who trade forex or are interested in getting into it, this is a pretty good deal. Just deposit $100 or more into a FXClub account and they give you $100; easy stuff.

Lastly, a few readers have been emailing me wondering what I've been doing with short-term cash in this environment. The crazy market volatility means I've reduced position sizes in the market and have much more cash on hand than I normally would. I've just parked some of that cash safely into FDIC insured online savings accounts. The yields aren't what they used to be (thank you Ben Bernanke), but you can still get some decent rates to park your cash safely in this environment and earn some interest. I've got accounts at both of these places:

  • Earn 2.75% APY with ING Direct Online Savings Account. These guys have been around the online savings game for a long time. I've had an account with them forever it seems. Easy interface, no fees, no minimums, and FDIC insurance at ING Direct.
  • 3.00% APY with HSBC Direct Online Savings. This is the other online savings account I've got. Slightly higher rate, but I personally like ING's setup a little bit better. The interest difference between the two doesn't add up to a whole lot anyways. But, HSBC Direct is definitely worth a look as they have no fees, no minimums, and FDIC insurance as well.

Peter Schiff's Latest Comments

Last week, Peter Schiff, president of Euro Pacific Capital, sat down on CNBC to discuss how he thinks Obama taking office will not necessarily help the crisis. Schiff has notoriously predicted much of what we've already seen in the markets and economy thus far. And, he thinks the dollar gets obliterated as we move forward (as do I).

S&P500 Crash Comparison

Calculated Risk has a great chart up of the comparison of various crashes over the years. And, obviously, the current crisis is easily the most direct and brutal of the four. Undoubtedly, this crash has accelerated due in part to the forced selling and hedge fund redemptions/withdrawals/liquidations.

(click to enlarge)

Thursday, November 6, 2008

Clarium Capital, Jana Partners, and Passport Capital Performance Update

Well, the numbers just keep rolling in. In a never ending battle with the market, hedge funds continued to slump in the month of October. Firstly, we'll discuss Clarium Capital, the $5.2 billion fund ran by Peter Thiel. We've covered Thiel and his macro fund extensively on the blog before. Thiel had a rough August. But, we noted that Clarium was faring pretty well as of the beginning of October; that is, until they shifted to equities.

The month of October meant pain yet again for Clarium. Year-to-date, the fund is now -3%. They lost nearly 18% in October mainly due to losses in bonds and undoubtedly the equity exposure they added. They had bet that yields would widen, but instead, they contracted. In their most recent investor letter, Clarium was borrowing $3.90 for every $1 in equity they had as of the week of October 24th. Yet, a week later, they increased their leverage and borrowed $4.40 for every $1. After being up 27% for the year a few months prior, they now have come full circle like the rest of the market and are now down for the year. You can check out Clarium's portfolio holdings here and if want more info on Peter Thiel then head here.

Next, turning to Jana Partners, we see that things haven't gotten much easier for them. Just last week, we wrote about how Jana had hit a rough patch. And, it seems that the pain continued through October. Jana's Piranha fund was -19.2% for the month of October and is now -21.7% for the year. This past month really turned things upside-down for that fund. Their Nirvana fund was -13.2% for the month of October and finds itself -21.9% for the year. Lastly, the Jana Partners fund had a much better October than their other funds, being down 6.6%, but its still down 20.4% for the year. Recently, we noted that Jana had taken a 13.52% stake in Convergys (CVG) and a 5.7% stake in Hayes Lemmerz (HAYZ).

Lastly, according to their most recent investor letter, $3 billion Passport Management LLC lost an astounding 38% for the month of October due to commodity stocks and now finds themselves down 44% for the year. The fund was started in 2000 and has a very respectable track record of gaining 27% annually.

You can check out the most recent batch of hedge fund investor letters here and some prior ones here. For more hedge fund performance numbers, check out our last hedge fund performance update.

T2 Partners Whitney Tilson's Take on the Markets

Whitney Tilson is manager of value hedge fund T2 Partners and he recently sat down with Aaron Task over at TechTicker to discuss his take on the current market. His thoughts are broken up into 3 parts.

Part 1: Blue Chips

Part 2: Cheaper Blue Chips

Part 3: 'Aggressive' Bets

Also, Tilson provided commentary for a FT article. In the article, it mentions that "Funds managed by Mr Tilson own Berkshire Hathaway, McDonald’s, Wal-Mart, Coca-Cola, Amex, Target, Crosstex Energy, Atlas Pipeline Partners, Leucadia National, Wendy’s and EchoStar Corporation."

And, if you've missed it, we've been detailing the activity of various other value players in the hedge fund space. Pershing Square's Bill Ackman recently spoke at the Value Investing Congress, ESL Investment's Eddie Lampert has lost a lot of money, Tiger Management founder Julian Robertson has been buying recently, and Warren Buffett has been selling puts on Burlington Northern (BNI).

James Altucher Likes Agriculture, Infrastructure for Obama Presidency

James Altucher, managing partner of Formula Capital recently sat down with Aaron Task over at Tech Ticker to discuss stocks poised to benefit from an Obama Presidency, now that we know he will for sure be in office. Altucher mentions he likes agriculture and infrastructure and seems them both as very cheap. Specifically, he likes Mosaic (MOS) and KBR (KBR). Also, he mentioned to check out closed end municipal bond funds, seeing how he anticipates Obama to raise taxes on dividends. Lastly, Altucher was not all that bullish on alternative energy, claiming, "The second there is an alt energy bill, oil will fall to $40 -- then we don't need it anymore." You can check out his thoughts here.

Wednesday, November 5, 2008

Investor Letters

Here are some more recent hedge fund investor letters. Do note that these are all .pdf files.

Maverick Capital (Lee Ainslie) - Portfolio holdings detailed here.

Colony Capital

Oaktree Capital Management

Hayman Advisors LP (Kyle Bass)

Balyasny Asset Management LP

Baupost Group (Seth Klarman)

Perry Capital

And, taken from Bloomberg, we're seeing that a few hedge funds that have typically been closed have since re-opened those funds to add capital,

"Steven Cohen, David Einhorn, Paul Singer, and Alan Howard are doing what most hedge-fund managers can't these days -- raising money from investors.

Singer's Elliott Management Corp. added $3 billion in the third quarter and Howard's Brevan Howard Asset Management LLP garnered new cash as they posted investment gains in a year when the average fund has lost 20 percent, people with knowledge of matter said. Cohen's SAC Capital Advisors LLC and Einhorn's Greenlight Capital Inc. have allowed investors into funds that had been closed since 2005, with Einhorn seeking several hundred million dollars this month."

Both SAC and Greenlight have suffered losses this year, as we detailed in our hedge fund performance update.


Gregor Macdonald has a great post up detailing an issue I've been mulling over myself: the flooding of the market with supply of treasuries. He writes,

"My view is that because current events in equity and credit markets are so dramatic, the market has not yet paid attention to the coming boundary, of debt-ology. However, I expect participants to direct their thinking this way quickly, once the intensity of the crisis lessens. I see two areas, where markets will inevitably focus.

First, The FED could be getting close to more unconventional measures, like direct buying of long-dated Treasuries to bring long-rates down. Second, the quantity of new Treasury issuance, both in train and intended, is so gargantuan that it’s not clear how the world would be able to actually take up the supply. There may be structural limitations. Simply put, it’s not clear there’s enough available capital in the world to increase the US debt position further. After all, we have already been sucking up the world’s savings for most of this decade. It strikes me the only method to ensure this new supply is taken up would be that other central banks would eventually have to monetize the USA, in the same way the USA is monetizing its own banking system. So future Treasury issuance may depend either on our own central bank to monetize it, or for foreign central banks to do the same. When either happens, I’m of the opinion it’s Game Over."

You can check out the rest of his post on the subject here. I mainy posted this up as food for thought and for a way to possibly play this impending situation. Over on Twitter, many of us finance/market junkies have been discussing tickers PST and TBT. PST is the etf for Ultra Short the 7-10 year treasury, and TBT is the etf for Ultra Short the 20+ year treasury. A few months ago, these vehicles didn't even exist. And, as of 2 weeks ago, I am long TBT. The consensus was that longer term maturity paper was a better short. Monitoring technical analysis on this name doesn't necessarily make a whole lot of sense given what it is, but I have noticed that the etf itself has seen support around $56/57 and resistance around $65, as noted in the chart below. Either way, I think this is a great longer-term play based on what we've seen lately in the supply of treasuries.

(click to enlarge)

I've posted regarding Gregor's writings before and would definitely suggest everyone check his blog out for some great insight into energy and other topics.

Credit Card Squeeze

I wanted to post up an excerpt from a piece in Fortune a while back which discussed the next Credit Crunch. In it, Geoff Colvin hints at what could be a difficult time for credit card companies. Some of this information sets up a broad backstory as to why one might short the likes of Capital One (COF), American Express (AXP), Discover Financial (DFS), or even banks like Citigroup (C) who have large credit card businesses.

Here's an excerpt from the article,

"Last year, just as the subprime crisis happened, credit card debt took off. The home-equity ATM had been shut down, so people turned to the last source of easy money they had left, the most expensive debt on the menu, credit card borrowing.

Since credit card debt has been growing much faster than the economy - more than 8% in last year's third and fourth quarters and over 7% in May (the most recent month reported)- people are apparently using it as a substitute for income. Thus, for the past year or so we have still maintained the standard-of-living illusion.

But a big crunch is coming - and here's why. Credit card debt, like mortgage debt, gets bundled, securitized, and sold off by banks. Citigroup (C), one of America's largest credit card lenders, just reported that it lost $176 million in the second quarter through securitizing such debt. That happens when the buyers of those securities observe rising delinquency rates and rising interest rates, and decide the debt is worth less than Citi thought. More generally, the amount of credit card debt that is securitized nationwide has plunged by more than half in the past five months because it's getting riskier. That means credit card issuers will be charging customers higher interest rates, and since the banks can't offload as much of the debt as before, they'll have less money to lend to cardholders.

The squeeze has already started, which is why Congress is in the process of passing the Credit Cardholders' Bill of Rights, which would prevent issuers from changing rates and terms without warning, among many other provisions. But bottom line, the credit card money window is going to start closing - and soon.

So now what? It's hard to see where consumers can turn next. Home prices seem highly unlikely to start rising again soon. Stocks? You never know, but the Great Bull Market looks like a once-in-a-lifetime event. Homes and stocks are households' biggest asset classes by far. There isn't much else to borrow against.

It may be that the standard-of-living bubble finally has to deflate. Sustainable increases in living standards have to be earned, not borrowed, and that means performing ever higher value work that can't be outsourced. We haven't been meeting that challenge very well; doing so will probably require much more and better education for millions of Americans, which takes time and money."

I agree with the overall theme of this article and truly believe that the strapped consumer is going to be facing larger headwinds than anyone anticipates (which I partly touched on here). Credit card debt is piling up for the average American, and many are having a very hard time paying it off. This simple concept was illustrated in a nice graph I posted earlier, showing how delinquencies are rising. Capital One (COF) is the perfect example of a company being impacted by this. It has been piling up each quarter and their most recent earnings/conference call gave us a further glimpse, as noted by Forbes' Melinda Peer, who writes

"Credit card and banking company Capital One (COF) said its net charge-off rate, or measure of soured loans, for its U.S. card business jumped to 6.34% in September, from 5.96% in August. Internationally, charge-offs rose to a rate of 5.87%, from 5.31%, in the same period.

Delinquencies, considered signs of troubled accounts, were also on the rise in the U.S. and abroad during September. Domestically the McLean, Va.-based company's 30-day delinquency rate inched up to 4.20%, from 4.07%, in August, and internationally the rate inched up to 5.24%, from 5.15%."

Calculated Risk also took the liberty of transcribing key comments from the conference call, which you can read here. Basically, the company is taking positive steps to reduce credit lines and try to limit their risk. But, they still won't be able to completely protect themselves from the impending tsunami.

Additionally, this WSJ article seems to imply that credit card companies and banks are going to face historic headwinds in the credit card arena. Overall, I truly believe this is going to be an over-arching theme that stems from the current crisis as things continue to bleed over to main street. The ultimate question becomes, how much of this is already priced into banking and credit card equities, if at all?

Full disclosure: At the time of publication, MarketFolly was short COF
Source: Fortune

Tuesday, November 4, 2008

Eric Bolling's Latest Commentary

Eric Bolling is out with another piece and he writes,

"Looking back on two years with similar profiles -- 1987 and 1929 -- we get a glimpse of what we might expect for the rest of the year and further. Both prior years, the market (Dow) was higher from the October crash lows by year-end. In 1987, the market came back 39% by year-end; in 1929 the Dow managed a 25% recovery from the lows seen during the October free fall. So sitting with a 19% gain from the October lows leaves room for upside going into the last two months of the year.

I have added some small positions to my very thin portfolio. I have added the U.S. Oil Fund (USO) and El Paso (EP). My feeling is that if we get this stabilization in the equities markets, oil's recent implosion will subside and crude might actually trade back up. Natural gas is El Paso's business, and a bump up in the gas price will help this battered stock.

My portfolio holds small positions in the SPDR Financials (XLF) and SPDR Homebuilders (XHB) and will for the upcoming quarter or so.

Lastly, I own PowerShares QQQ Trust (QQQQ) and SPDR Trust (SPY) in a very-short-term portfolio. These may be sold quickly if I believe the Senate, House and White House will all go to Democratic wins."

Overall, Bolling is putting an emphasis on being nimble and being able to get liquid. A lot of his picks are shorter-term and are being used as trading vehicles to benefit from the price action. Keep in mind that he is a trader and he acts switfly. I do agree with his selection of USO (which is essentially an ETF that buys front month crude oil contracts and is a direct proxy for playing the price of oil). However, I picked up DBO instead last week, which plays contracts of oil almost a year out, rather than front month. The reason I have done so is because the oil curve is currently in contango where the front-month is trading very cheap and the entire curve going further into the future is priced much higher. Therefore, whenever USO "rolls over" to the new contract each month, you're essentially getting crushed. While it is definitely nice to have ETFs to essentially trade crude oil in the stock market without having to go to a commodities exchange, you've got to be aware of the differences/limitations of USO or DBO. Keep an eye out over the next week or so, as I've got a piece coming out that will talk about oil more in-depth.

You can check out the entirety of his post on here.

Goldman Sachs Conviction Lists Update

A few more changes were made to the Goldman Sachs Conviction Buy list early this week. Firstly, Arcelor Mittal (MT) was added to the Conviction Buy List. Schlumberger (SLB) was also added to the buy list with a new price target of $59. Schlumberger, as we've detailed here on Market Folly, has a heavy concentration of hedge fund ownership, including the likes of Boone Pickens' BP Capital, Stephen Mandel's Lone Pine Capital, and many more funds.

Additionally, Humana (HUM) was removed from the buy list, but the firm still maintains a regular 'buy' rating on the stock. Transocean (RIG) was also removed from the Conviction Buy list, having been added to the list just recently back in September.

Boeing (BA) was added to the Conviction Sell List. Lastly, HealthNet (HNT) was removed from the Conviction Sell list.

If you've missed them, we've detailed previous changes that were made to Goldman's coveted lists on October 27th here, as well as the changes from October 20th here.

Checking in on Jim Rogers & George Soros

In keeping up with all the various hedge fund managers and 'whales,' I would be remiss if I did not include Jim Rogers and George Soros, co-founders of the legendary Quantum Fund. In a recent Canadian Business article, Jim Rogers sat down to share his thoughts.

"In fact, so convinced is Rogers of the commodities story that he has been buying agricultural products while selling U.S. dollars through this period. “The U.S. dollar is the most flawed currency in the world right now. I plan to sell all my U.S. dollar holdings on this boost. It’s losing its status as the reserve currency of the world,” said Rogers at a press conference before the dinner. “We owe the world $13 trillion and every 15 months we add another $1 trillion.

According to this theory, the drop off in commodity prices is just what the Chinese economy, already suffering from inflation, needs right now. The drop in prices will give the Chinese economy some breathing room. And if the country can avoid a major meltdown, the slack in western demand might be just the thing to allow China to increase its own consumption bubble. Not only that, but as China reduces its reliance on foreign exports we might see the country focus on more internal consumption, and that will see it pull in even more resources.

Let’s not overlook the fact that as prices drop, all kinds of new projects to bring more commodities online are being delayed. That means even less new supply online and ready to go once the world economies get back on the growth track. That is, the current price declines are piling fuel up for a new commodities boom, which sits just one recovery out says Rogers."

Additionally, Rogers recently appeared on Bloomberg to discuss his theses.

George Soros, on the other hand, sees a vast contraction in the hedge fund industry. He is not alone in this regard, as we also pointed out previously in our post 'Hedge Fund Redemptions: Let the Bloodbath Begin.' If the recent hedge fund performance numbers are any indication of the true pain felt in the broader industry, then Soros should be right on the money with this call as redemptions continue. Soros recently said,

" 'The hedge fund industry is going to move through a shakeout,' Soros said in a speech at the Massachusetts Institute of Technology in Cambridge, Massachusetts. 'In my estimation (the industry) will be reduced in size by anywhere between half and two thirds.' "

You can view the entirety of Soros' thoughts at MIT by clicking here (windows media file). Additionally, it should be noted that Soros definitely agrees with Rogers when it comes to agriculture. As we noted back in August, Soros had been picking up a lot of Potash (POT). And, we also recently posted Soros' in-depth interview with Fareed Zakaria.

Overall, these investing legends seem to harp on one major point: the commodities bull is not over, it is just beginning.

Sources: Canadian Business, MIT

Few More Hedge Fund Performance Numbers

Got a few updates as to just how bad October was to some of our beloved hedge funds courtesy of Dealbreaker. Firstly, Blackrock's All-Cap energy hedge fund saw some rough waters last month.

"The ESTIMATED monthly and year-to-date (YTD) returns for The All-Cap Energy Hedge Fund as of 31 October 2008 were:

October 2008: -34.75%* net

YTD 2008: -54.0%* net"

But, they emphasize that these are based on 'estimated prices.'

Next up, we've also got some assorted fund numbers. As of Friday's close:

"Greenlight Capital Offshore, Ltd:
MTD: -9.70%
YTD: -22.77%

Maverick Fund, Ltd:
MTD: -6.34%
YTD: -26.47%

Viking Global Equities LP
More specific breakdown:

Viking Global Equities III, Ltd. 2008:

Jan: -3.00
Feb: 3.40
Mar: -0.60
Apr: 3.90
May: 4.00
Jun: -0.20
Jul: 0.80
Aug: 0.50
Sep: -9.40
Oct: -1.10

YTD: -2.41

Viking Global Equities, LP


Jan: -3.00
Feb: 3.40
Mar: -0.60
Apr: 3.80
May: 0.60
Jun: -0.20
Jul: 0.80
Aug: 0.50
Sep: -7.70
Oct: -1.10

YTD: -3.92"

And, lastly, we see that Goldman Sachs Investment Partners, their $6 billion new fund this year has lost $989 million as of September, according to the FT. They are down 15.5% ytd as of September. The fund is ran by Raanan Agus and Kenneth Eberts, who formerly ran proprietary trading desks for Goldman. As per the FT,

"More than half of GS Investment Partners’ losses in the third quarter was from its investments in commodities, basic materials, metals, mining, energy and agriculture. But like many multi-strategy funds diversified across equity, credit markets and convertible bonds, GS Investment Partners was hit hard by losses on convertible bonds – debt instruments that can convert into equity. It said returns from the convertible asset class had been 'abysmal.' "

Additionally, the article mentions that Ken Griffin's Citadel Kensington fund is now down 37% year to date as of October 27th. We recently wrote about the pain Citadel was experiencing here. You can check out a whole slew of other hedge fund performance numbers from our most recent major hedge fund performance update.

Monday, November 3, 2008

Updates on Bill Ackman's Pershing Square

Bill Ackman and Pershing Square Capital certainly have been busy lately. If you're unfamiliar with them, Bill Ackman runs Pershing Square Capital, a value/activist based hedge fund. The fund started in 2003 after Gotham Partners broke up. The past few years, he has had notable short positions in the bond insurers such as MBIA (MBI) and Ambac (ABK). Some of his activist positions include Target (TGT) and Borders (BGP). Recently, he detailed his plans for Target to spin-off its real-estate to unlock value. We'll see if this proposal picks up any steam. We recently noted Pershing Square's portfolio performance, which was included in our latest hedge fund performance update. Also, we wrote about Mr. Ackman's recent speech at the Value Investing Congress.

Recently, in an amended 13F filing with the SEC for the quarter that ended June 30th 2008, Ackman's Pershing Square has disclosed a 39.9 million shares position in EMC Corp (EMC). As of the time of the filing, Ackman had $586 million worth of EMC. Additionally, Ackman recently filed an amended 13D with the SEC for Long's Drug Stores (LDG), disclosing an 8.8% ownership stake. As per the filing, they now own 3,137,659 shares. And, Lastly, Ackman filed a 13G on Wendys/Arby's Group (WEN) back on October 10th, disclosing an 11.91% stake in the company. As per the filing, they own 55,619,748 shares.

Stocks Around Multi Year Support

Blain over at StockTradingToGo has again assembled a nice arsenal of charts that could be very beneficial to some investors. While I know not everyone agrees with/uses technical analysis, I think its a great tool that should be added to any investor's toolbox to help them making investing/trading decisions. Still need convincing? Numerous prominent and successful hedge fund managers use technicals religiously to help gauge price action, especially Paul Tudor Jones of Tudor Investment Corp.

Last week, I posted up some charts showing bearish continuation patterns, courtesy of Blain. This time around, he's got some great charts up showing stocks that are hovering around multi-year support levels. A few of those stocks are:

Fuel Systems Solutions (FSYS)

(click to enlarge)

Mastercard (MA)

(click to enlarge)

Research in Motion (RIMM)

(click to enlarge)

So, if you're a trader, you could play these levels for short-term bounces, placing stops just below the multi-year support levels (or short on a break below the support). If you're an investor, you could look to place orders around these levels to help accumulate shares at levels that historically have been important to the stock. Blain's got a few more charts of stocks that fit this criteria here.

Visa (V) Consumer Spending Trends

Earnings Breakout has some important highlights/takeaways from the most recent Visa (V) earnings report/conference call.

"-Debit is now 53% of payments
-All disputes with major competitors now resolved
-Further slowdown in U.S. (10%) and cross-border volumes. Debit low-to-mid double digits. Credit got weaker through September
-Additional moderation from September to October. U.S. credit volume +1-2% in September turned NEGATIVE first few weeks of October. Debit still low double-digits
-Seeing shift to non-discretionary purchases. More credit worthy are driving purchases
-53% of debit spend is non-discretionary. >40% overall. Last recession it was 30%"

Those last 2 bullet points re-affirm the fact that the consumer will be in a pinch for a while to come and consumer recessions can be brutal. That will of course drive down consumer spending and thus corporate profits, which in turn reduces earnings estimates. But, that's a no-brainer given that earnings estimates are too high to begin with. The trends that Visa is seeing are of course a result of a rising unemployment rate and sluggish housing market, among other things.

I like to use Visa (V) and Mastercard (MA) as gauges on the economy simply because they are purely payment processors. They process both debit and credit spending as more and more people are using less cash and more plastic to pay for their purchases. They essentially are our eye on the consumer. So, when the aggregators like MA and V notice big spending trends, you better pay attention. And, although the consumer recession is upon us and will likely worsen, I still like MA and V as much longer-term plays. Like I said, they are purely payment processors and the world is shifting away from cash. Legendary investor and former Tiger Management hedge fund manager Julian Robertson agrees and recently bought both MA and V. This investment will almost have to be treated as a value play given the fact that they will face near-term headwinds with the credit crunch and a consumer slowdown. But, long-term, I think these are solid businesses to own, and I detailed why here.

Check out the rest of the Visa (V) earnings/conference call summary at Earnings Breakout.

Sunday, November 2, 2008

Pershing Square's Bill Ackman at Value Investing Congress

Todd Sullivan over at Value Plays has posted up an excellent audio clip of the Q&A session Bill Ackman held during the Value Investing Congress that took place a few weeks ago. Well worth your time to listen.

Carlos Slim Shows Stake in Bronco Drilling (BRNC) - 13G Filing

In a 13G filed with the SEC recently, Mexican businessman Carlos Slim has disclosed a 7.64% ownership stake in Bronco Drilling (BRNC). He now owns 2,200,000 shares of the company.

Carlos Slim is a well-known Mexican businessman who amassed his wealth through telecom. He is known for his association with America Movil (AMX), Telcel, and Telefonos de Mexico (TMX) and was the second richest man in the world as of 2008.

Taken from Google Finance, Bronco Drilling "provides contract land drilling and workover services to oil and natural gas exploration and production companies. As of February 29, 2008, the Company owned a fleet of 56 land drilling rigs, of which 45 were marketed and 11 were held in inventory. Bronco also owned a fleet of 59 workover rigs, of which 49 were operating and 10 were in the process of being manufactured. The Company also owned a fleet of 70 trucks used to transport its rigs."

Carlos joins the ranks of many other investors that have taken advantage of the market volatility to increase/establish stakes in companies. Other recent action includes hedge fund Jana Partners taking a stake in Convergys (CVG), Blue Ridge Capital increasing their stake in Millipore (MIL), and Tremblant Capital establishing a stake in Advanced Medical Optics (EYE), among others.