Chase Coleman's Tiger Global Sells Some Longtop Financial Technologies (LFT): 13D Filing ~ market folly

Monday, June 29, 2009

Chase Coleman's Tiger Global Sells Some Longtop Financial Technologies (LFT): 13D Filing

Chase Coleman's hedge fund Tiger Global just recently amended their 13D filing on Longtop Financial Technologies (LFT). A 13D filing signifies an activist investment in a company and must be filed when a firm or investor acquires 5% or more of a company's shares. Tiger made this amendment due to activity on June 16th, 2009 and they are now showing a 14.6% ownership stake in Longtop Financial Technologies (LFT) with 7,456,294 shares.

This is down from their previously disclosed 8,951,065 shares in their last 13F filing. So, since March 31st, 2009, Tiger has sold 1,494,771 shares of LFT. They were selling the shares on June 9th, 10th, and 15th-19th. Their sale prices ranged from $26.53 to $29.56. Taken directly from the 13D filing, "The Reporting Persons have filed a Form 144 with the Securities and Exchange Commission indicating their reasonable intention to dispose of shares of the issuer, and the issuer has filed a resale Registration Statement covering possible sales by the Reporting Persons of their shares of the Issuer in registered transactions". As such, Tiger has been reducing their position. We also covered Tiger's entire portfolio here.

Chase Coleman is yet another 'Tiger Cub,' or manager who learned their trade under the watch of Julian Robertson while at Tiger Management. We track Coleman's Tiger Global due to their strong historical performance and proven fundamental research methodology. In fact, Tiger Global is one of the hedge funds that comprises the Tiger Cub Portfolio created with Alphaclone where you can replicate their positions and enjoy 15.5% annualized returns since 2000. The numbers say it all and Tiger Global's contribution to such a portfolio is one of the many reasons we track them.

We recently ran a profile of Julian (Chase's mentor) and talked about one of his big investment bets as well. Chase attended Williams College and his focus in the markets has always been on smaller cap names and on technology. Although, he has since expanded his horizons with time. An interesting fact about Coleman is that he is a descendant of Peter Stuyvesant, the man who built the wall that gave Wall Street its name. He was clearly born for Wall Street. In 2007, Tiger Global returned 70%, and from 2001-2007, Coleman bolstered an average return of 47%. In terms of recent performance, we saw that Tiger was -12.9% for April and were -8.1% for the year at that time. Their poor performance has been due to pain from their financial and REIT short positions, which they discussed in their quarterly letter.

Taken from Google Finance, Longtop Financial Technologies is "a software developer and information technology (IT) services provider targeting the financial services industry in China. The Company develops and delivers a range of software solutions with a focus on meeting the IT needs of financial institutions in China. Longtop Cayman offers select software solutions in the categories, such as channel-related solutions, business-related solutions, management-related solutions and other value-added solutions, covering categories of IT requirements for financial institutions in China."

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