Hedge Fund Portfolio Tracking: Second Quarter 2009 Edition ~ market folly

Monday, August 17, 2009

Hedge Fund Portfolio Tracking: Second Quarter 2009 Edition

It's baaaaack. This post is the preface to the series we will be doing in the coming weeks that details what many prominent hedge funds have been up to in the second quarter of 2009 as per their 13F filing.

Four times a year (once each quarter), hedge funds & asset managers with greater than $100 million AUM (assets under management) are required to report to the SEC their long holdings from the previous quarter. These filings do not show the funds' short positions and require them to disclose their long holdings in equity markets. Additionally, they are required to file various puts or calls purchased in the options market as well as notes & bonds. These filings do not cover commodities, currencies, or other markets. So, we just wanted to clarify that for people new to 13F filings.

We check these 13F filings quarterly just to get a sense as to where these funds are putting their money. If you just sit down and do some simple number crunching between this quarter's 13F and the one prior, you can see exactly what everyone has been up to. And, if you create a cloned portfolio based on these top hedge fund holdings, you can see 28.5% annualized returns like our custom Market Folly portfolio created with Alphaclone.

Please note that these 13F's should be treated as a lagging indicator simply because the 13F's that are being released currently (August 12th-21st 2009) show the funds' portfolio holdings as of June 30th, 2009. So, in the past month and a half, they could have completely changed their portfolio. But, at the same time, its easy to see which sectors they are flocking to and what their concentrated positions are.

We like to specifically follow equity focused hedge funds as they are the easiest to track. We focus on value based (or growth-at-a-reasonable-price) hedge funds in the hope that they won't experience ridiculously high turnover and thus allow us to somewhat track their movements as they build up concentrated positions. Specifically, we follow the 'Tiger Cubs' (otherwise known as the proteges of former hedge fund Tiger Management legend Julian Robertson). Many of these former proteges/right-hand men have started their own funds and here are the ones we've been following.

- John Griffin's Blue Ridge Capital - portfolio updated
- Stephen Mandel's Lone Pine Capital - portfolio updated
- Lee Ainslie's Maverick Capital - portfolio updated
- Andreas Halvorsen's Viking Global
- Chase Coleman's Tiger Global
- Touradji Capital (Paul Touradji)
- Shumway Capital Partners (Chris Shumway)

Additionally, we also like to follow the Commodities Corporation "offspring" which have gone off to start their own funds and typically employ a global macro strategy. We don't track them for their equity portfolios per se, but we like to see what sectors they might be flocking to and whether or not they have a large amount of assets allocated to US equities.

- Tudor Investment Corp (Paul Tudor Jones)
- Moore Capital Management (Louis Bacon)
- Caxton Associates (Bruce Kovner)

Additionally, we like to follow other well known investment gurus. These include:

- Warren Buffett
- Carl Icahn
- George Soros (portfolio updated)

Next, there is an assortment of funds that employ various strategies ranging from activist to global macro and often run concentrated portfolios. We track some of these funds due to their solid returns over the years, while we track others due to the spotlight that has been cast on them during the crisis.

- Timothy Barakett's Atticus Capital (recently announced they are shutting down their main fund)
- Bret Barakett's Tremblant Capital
- Peter Thiel's Clarium Capital
- Art Samberg's Pequot Capital (recently announced closure)
- Philip Falcone's Harbinger Capital Partners - portfolio updated
- Boone Pickens' BP Capital
- John Paulson's Paulson & Co
- Barry Rosenstein's Jana Partners
- Eric Mindich's Eton Park Capital - portfolio updated
- Farallon Capital Management (Thomas Steyer)
- Raj Rajaratnam's Galleon Group
- Ken Griffin's Citadel Investment Group
- Jeffrey Gendell's Tontine Associates

A few deep value & activist funds:

- Seth Klarman's Baupost Group - portfolio updated
- David Einhorn's Greenlight Capital - portfolio updated
- Dan Loeb's Third Point LLC - portfolio updated
- Bill Ackman's Pershing Square Capital Management - portfolio updated

For our readers, we also track some quant and highly active trading funds. We do not track these firms to gain insight for portfolio investing ideas. Instead, it's merely for fun because for whatever reason, people like to see what they are doing. It's basically useless to track them due to their quant or high frequency trading nature and none of us could really tell you the rhyme or reason behind any one of their positions.

- Jim Simons' Renaissance Technologies
- Steven Cohen's SAC Capital
- David Shaw's D.E. Shaw & Co.

We also track some managers who previously worked at funds mentioned throughout the list above, but now have struck out on their own. As they were some of the brains behind the solid returns of some funds listed above, we feel it's only appropriate to track them now.

- David Stemerman's Conatus Capital (ex-Lone Pine) - portfolio updated
- Anand Parekh's Alyeska Investment Group (ex-Citadel)
- James Pallotta's Raptor Capital Management (on hiatus for now, ex-Tudor)

We've also just recently started to track another set of funds due to high demand from our readers. While Market Folly is a team of 1, we'll try our best to crank out as much hedge fund content as we can.

- Passport Capital (John Burbank)
- Sprott Asset Management (Eric Sprott)
- Balyasny Asset Management (Dmitry Balyasny)
- Hilltop Park Fund (Stanley Shopkorn, ex-Moore)
- White Elm (Matthew Iorio, ex Lone Pine)
- Highside Capital (Lee Hobson, ex-Maverick)

Over the coming weeks we'll touch on some of the important position moves these funds and market gurus have made. Our hedge fund coverage now spans well over 40+ funds. If you would like to see a specific hedge fund covered here on MarketFolly.com, post up a comment in the comments section below. We're always looking to add more funds that readers would like to see, so please drop in your suggestions.

Last, but not least, we're always looking for people to help us cover these hedge funds, as it gets to be a bit tedious (this is a one-man show here). If you're interested in helping out posting up 13F information or have resources worth sharing, please get in contact with us at the top of the site. The hedge fund tracking series second quarter 2009 edition starts today, so spread the word and check back daily.

Up first today: Bill Ackman's Pershing Square Capital Management (coming in a separate post).

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