Touradji Capital Management (Paul Touradji) 13F Filing Q4 2008 ~ market folly

Monday, April 6, 2009

Touradji Capital Management (Paul Touradji) 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 Touradji Capital ran by Paul Touradji. Touradji is one of many well-known 'Tiger Cubs' who started their own firms after leaving Julian Robertson's Tiger Management. We've already covered many of the 'Tiger Cub' funds including Stephen Mandel's Lone Pine Capital, Andreas Halvorsen's Viking Global, Lee Ainslie's Maverick Capital, Chase Coleman's Tiger Global, Chris Shumway's Shumway Capital Partners, and John Griffin's Blue Ridge Capital. Taken from our post on 'Tiger Cub' biographies, "Paul Touradji is the President and Chief Investment Officer of Touradji Capital Management LP, a New York-based hedge fund specializing in fundamental research and active investment in commodities and related assets. The firm manages approximately $3.5 billion and invests in both the public and private markets. Mr. Touradji has well over a decade of experience investing in the commodity, equity, and macro markets. Mr. Touradji began his commodities career at Tiger Management in the mid '90s, where he managed the commodities team; it was at Tiger that he developed his fundamental approach to analysis and investment in commodities. Prior to Tiger, Mr. Touradji’s specialty was quantitative arbitrage, principally with O’Connor Partners. Mr. Touradji is a 1993 graduate of the McIntire School of Commerce at the University of Virginia and a Certified Financial Analyst."

Towards the end of last year
at a 'Tiger Cub' hedge fund manager panel, Touradji advocated shorting Copper as the world deleverages and the velocity of money drops, and that thesis played out just as predicted. It would be interesting to get his updated take on copper now that it has rallied back a little bit. We just recently noticed that Touradji was one of the Top 25 highest paid hedge fund managers in 2008, coming in at number 16. Also, back in January we mentioned that Touradji was starting an additional fund. Please note that Touradji specializes in commodities and those holdings are not reported in 13F filings. But, he still has some equity positions and we check in on those each quarter. We keep tabs on him for his Tiger background, his solid overall performance, and to see if he is playing any investment themes. But, we want to make sure everyone realizes that he is different than the typical hedge funds we cover and he has limited equity exposure.

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):
General Electric (GE)
Jacobs Engineering (JEC)
Gushan (GU)

Some Increased Positions (A few positions they already owned but added shares to)
Sandridge Energy (SD): Increased by 291%

Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
Encore Acquisition (EAC): Reduced position by 50%
Chesapeake (CHK): Reduced position by 48.8%
McDermott (MDR): Reduced position by 39.7%
Whiting Petroleum (WLL): Reduced position by 30%
Delta Petroleum (DPTR): Reduced position by 27.5%
Baker Hughes (BHI): Reduced position by 5.4%

Removed Positions (Positions they sold out of completely)
Spdr S&P500 (SPY)
Hornbeck Offshore (HOS)
Cano Petroleum (CFW)
Frontier Oil (FTO)
Tesoro (TSO)
BMB Munai (KAZ)
Storm Cat (SCU)
Mosaic (MOS)
Continental Resources (CLR)
Steel Dynamics (STLD)
Nucor (NUE)
Devon Energy (DVN)
Terra Industries (TRA)
XTO Energy (XTO)
Transocean (RIG)
Select Sector Energy (XLE)
Hess (HES)

Top 15 Holdings (by % of portfolio)

  1. General Electric (GE): 51.5% of portfolio
  2. Petrohawk (HK): 12.64% of portfolio
  3. Baker Hughes (BHI): 5.8% of portfolio
  4. Jacobs Engineering (JEC): 5.73% of portfolio
  5. Comstock Resources (CRK): 3.68% of portfolio
  6. Sandridge Energy (SD): 3.6% of portfolio
  7. Delta Petroleum (DPTR): 2.56% of portfolio
  8. Range Resources (RRC): 1.5% of portfolio
  9. McDermott (MDR): 1.2% of portfolio
  10. Chesapeake Energy (CHK): 1.2% of portfolio
  11. Apache (APA): 1.1% of portfolio
  12. Anadarko Petroleum (APC): 1.1% of portfolio
  13. Talisman Energy (TLM): 1% of portfolio
  14. Noble Energy (NBL): 1% of portfolio
  15. CVR Energy (CVI): 0.93% of portfolio

As we mentioned above, please again note that Touradji has very limited equity exposure and is primarily in commodities and other markets. We track him to monitor any themes he may be playing and from his holdings it looks like he likes natural gas a little bit via Petrohawk and Chesapeake. They also boosted their stake in Sandridge pretty substantially. But, by far the most notable move in their portfolio was the addition of General Electric. They started it as a new position and brought it up to over 50% of their portfolio, which is a very peculiar thing to see (even for a fund that isn't usually in equities). We'll have to see if this was merely a trade or something more. It's very rare to see funds with such a large concentration of their assets in one equity like this. Assets from the collective long US equity, options, and note holdings were $150 million last quarter and were $146 million this quarter. Again, note that that this $146 million is only one small fraction of his overall assets under management. Lastly, we wanted to point out that Touradji recently sent out an investor letter regarding the illiquid portion of their portfolio. This is just one of many funds in our hedge fund portfolio tracking series in which we're tracking 35+ prominent funds.

We've already covered:

We cover a new hedge fund each day and you can see the complete list of hedge fund portfolios here.

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