Art Samberg's Pequot Capital Management 13F Filing Q4 2008 ~ market folly

Thursday, March 26, 2009

Art Samberg's Pequot Capital Management 13F Filing Q4 2008

This is the 4th Quarter 2008 edition of our ongoing hedge fund portfolio tracking series. Before reading this update, make sure you check out the Hedge Fund 13F filings preface.

Next up is Pequot Capital Management run by Art Samberg. Pequot was founded by Art in 1986 with $3 million in assets and peaked with $15 billion in assets around the tech bubble. Today, he manages over $4 billion. They have 150 employees and employ multiple strategies, including private equity and venture capital, as Art believes equity returns will decline over time. Art holds a S.B. from Massachusetts Institute of Technology, an M.S. from Stanford University, and he received his MBA from Columbia University. Pequot Capital Management was recently ranked 93rd in Alpha's hedge fund rankings. In terms of their 2008 performance, their main fund was -17.5% for 2008, while their health care fund finished -27.9% as noted in our post on hedge fund year-end performance. Recently, we had noted that they amended some 13G filings and made some portfolio changes to a few larger positions. You can also read Pequot's March Commentary here by Byron Wien.

The following were their long equity, note, and options holdings as of December 31st, 2008 as filed with the SEC. We have not detailed the changes to every single position in this update, but we have covered all the major moves. All holdings are common stock unless otherwise denoted.

Some New Positions (Brand new positions that they initiated in the last quarter):
Medarex (MEDX)
Service Corp (SCI)
Brinker (EAT)
Marsh & McClennan (MMC)
Partnerre (PRE)
Hewitt (HEW)
Regal Entertainment (RGC)
Google (GOOG)
Verifone (PAY)
Sterling Financial (STSA)
Shaw Group (SGR)
Renaissance Re (RNR)
Continental Airlines (CAL)
MGM Mirage (MGM)
Onyx Pharma (ONXX) Calls
Amazon (AMZN)
American Italian Pasta (AITP)
Southwestern Energy (SWN) Calls
National Oilwell Varco (NOV)
Arch Capital (ACGL)
Microsoft (MSFT) Calls
Brink Home Security (CFL)
Cisco (CSCO) Calls
Exxon Mobil (XOM) Calls
Apple (AAPL) Calls
SPDR Gold (GLD) Calls
Monsanto (MON) Calls
Everest Re (RE)

Some Increased Positions (A few positions they already owned but added shares to)
XTO Energy (XTO): Increased by 655%
Apple (AAPL): Increased by 59.8%
Lifetime Fitness (LTM): Increased by 47.5%
Qualcomm (QCOM): Increased by 24.4%
Lender Processing (LPS): Increased by 18.4%

Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
Bank of America (BAC): Reduced by 58%
Huron Consulting (HURN): Reduced by 51.8%
SPDR Gold (GLD): Reduced by 50%
Apollo Group (APOL): Reduced by 45%
Qualcomm (QCOM) Calls: Reduced by 43.4%
Jack in the Box (JBX): Reduced by 32%
Onyx Pharma (ONXX): Reduced by 26.7%
Akorn (AKRX): Reduced by 25%
Panera Bread (PNRA): Reduced by 21%

Removed Positions (Positions they sold out of completely)
JPMorgan Chase (JPM)
ThermoFisher Scientific (TMO)
Cognizant Tech (CTSH)
Coach (COH)
Microstrategy (MSTR)
Burlington Northern (BNI)
Mohawk (MHK)
Sunpower (SPWRA)
McGraw Hill (MHP)
Scientific Games (SGMS)
State Street (STT)
Helmerich and Payne (HP)
Freeport McMoran (FCX)
Moodys (MCO)
Union Pacific (UNP)
Bank of NY Mellon (BK)
Nasdaq (NDAQ)
Halliburton (HAL)
Cigna (CI) Puts
Middleby (MIDD)
Weatherford (WFT)
Microsoft (MSFT)
Healthcare Services (HCSG)
Wells Fargo (WFC)
JC Penney (JCP)
Ultra Petroleum (UPL)
Chesapeake (CHK) Calls
XTO Energy (XTO) Calls
iShares Emerging Markets (EEM) Puts

Top 20 Holdings (by % of portfolio)

  1. SPDR Gold (GLD): 12.05% of portfolio
  2. Chipotle (CMG-B): 4.74% of portfolio
  3. XTO Energy (XTO): 4.6% of portfolio
  4. McDonalds (MCD): 4.35% of portfolio
  5. Southwestern Energy (SWN): 3.93% of portfolio
  6. Everest Re (RE): 3.77% of portfolio
  7. Qualcomm (QCOM): 3.7% of portfolio
  8. Akorn (AKRX): 3.14% of portfolio
  9. Onyx Pharma (ONXX): 3.07% of portfolio
  10. Walmart (WMT): 3% of portfolio
  11. Qualcomm (QCOM) Calls: 2.77% of portfolio
  12. Monsanto (MON) Calls: 1.99% of portfolio
  13. Goldcorp (GG): 1.98% of portfolio
  14. SPDR Gold (GLD) Calls: 1.95% of portfolio
  15. Apple (AAPL) Calls: 1.76% of portfolio
  16. Apollo Group (APOL): 1.61% of portfolio
  17. Exxon Mobil (XOM) Calls: 1.58% of portfolio
  18. Occidental Petroleum (OXY): 1.56% of portfolio
  19. Lender Processing (LPS): 1.54% of portfolio
  20. Jack in the Box (JBX): 1.47% of portfolio

So, we have yet another big fund with Gold in the top 3 positions of their portfolio. Samberg's Pequot joins the ranks of David Einhorn's Greenlight Capital, Paulson & Co (John Paulson), and Eric Mindich's Eton Park as prominent funds holding gold as a top position. Pequot also shows a large position in Goldcorp as well, as their 13th largest holding. Assets from the collective long US equity, options, and note holdings were $3 billion last quarter and were $1.26 billion this quarter. This is just one of many funds in our hedge fund portfolio tracking series in which we're tracking 35+ prominent funds.

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