Soros Fund Management's Portfolio: Adds Citigroup & Monsanto, Dumps Potash (13F Filing) ~ market folly

Tuesday, March 2, 2010

Soros Fund Management's Portfolio: Adds Citigroup & Monsanto, Dumps Potash (13F Filing)

(This post is part of our series on tracking hedge fund portfolios. If you're unfamiliar with tracking investments they disclose via SEC filings, check out our series preface on hedge fund 13F filings.)

Next up is hedge fund Soros Fund Management. While many will automatically attribute this fund to George Soros, much of the credit also goes to his son Robert Soros who runs the flagship Quantum Endowment Fund. But for those of you wanting an inside look at George Soros' portfolio, look no further. We follow Soros' portfolio movements due to his macro sense and solid track record. We like to see what sectors he is flocking to and these filings are the perfect example of possible themes his firm might be seeing. Soros Fund Management is a true global macro player as they dabble in pretty much any asset class they desire, so just keep that in mind as the below only details their equity and options holdings.

In the past Soros has said one of his main concerns is the deleveraging of the US consumer over a longer period of time which will hurt consumer spending and thus growth going forward. More of Soros' thoughts on the financial markets are detailed in his latest book, The New Paradigm for Financial Markets: The Credit Crisis of 2008 and What It Means.

For 2009, Soros' Quantum Endowment Fund was up 28% as noted in our hedge fund performance numbers list. In the past we've also detailed some of their recent portfolio maneuvers. The positions listed below were their long equity, note, and options holdings as of December 31st, 2009 as filed with the SEC. All holdings are common stock unless otherwise denoted.

Brand New Positions
Citigroup (C)
DirecTV (DTV)
Select Sector Financials (XLF)
Calls Bunge (BG)
Kinross Gold (KGC)
Autonation (AN)
The rest of their new holdings were less than 0.5% of reported assets each:
Dollar General (DG), Heinz (HNZ), Orbital Sciences Bonds, Shanda Games (GAME), Hasbro (HAS), CTrip (CTRP), RailAmerica (RA), Sandridge Energy (SD), Energy XXI (EXXI), CVR Energy (CVI), Sina (SINA), Transatlantic (TAT), American Axle (AXL), & China Real Estate Information (CRIC)

Increased Positions
Select Sector Financials (XLF): Increased by 63,730% (no, not a typo)
Pfizer (PFE): Increased by 365%
Monsanto (MON): Increased by 244.4%
Suncor (SU): Increased by 171%
SPDR Gold Trust (GLD): Increased by 152%
Emdeon (EM): Increased by 54.6%
Plains Exploration (PXP): Increased by 14%
Hess (HES): Increased by 11.2%

Reduced Positions
Linear Technology Bonds: Reduced by 8%

Removed Positions (Sold out completely):
Potash (POT)
Goldman Sachs (GS) Puts
Audiocodes Notes
S&P 500 (SPY)
Wyeth (WYE) ~ merger transaction complete
iShares Emerging Markets (EEM) Puts
Applied Materials (AMAT)

The rest of the stakes they dumped were quite small, each less than 0.5% of the previously reported assets: Petrohawk (HK), Focus Media (FMCN), SPSS Bonds, RPM (RPM), Liberty Media (LMDIA), Conexant Systems Bonds, Renesola (SOL), MSC Software (MSCS), Navistar (NAV), Covanta (CVA) Calls, S&P 500 (SPY) Puts, & Anadarko Petroleum (APC) Calls

Top 15 Holdings by percentage of assets reported on 13F filing

  1. SPDR Gold Trust (GLD): 7.5%
  2. Petroleo Brasileiro (PBR): 4.2%
  3. Hess (HES): 3.9%
  4. Monsanto (MON): 3.6%
  5. Citigroup (C): 3.5%
  6. LSI Bonds: 2.88%
  7. Suncor (SU): 2.86%
  8. Petroleo Brasileiro (PBR-A): 2.82%
  9. Interoil (IOC): 2.42%
  10. Linear Technology Bonds: 2.4%
  11. Pfizer (PFE): 2.4%
  12. Plains Exploration (PXP): 2.18%
  13. RF Micro Bonds: 2.1%
  14. Select Sector Financials (XLF): 1.95%
  15. Mcdata Notes: 1.94%

Much has been made in the media recently about the fact that George Soros has been out calling gold a bubble but has more than doubled his exposure to the gold exchange traded fund GLD. First, keep in mind that these portfolio disclosures were as of December 31st, 2009. So technically he could have sold completely out by now. It's also possible that they are merely using this position as a hedge of some sort. Also keep in mind that George is probably less involved with the day-to-day operations of the hedge fund these days as his son Robert is more responsible for running the show at Quantum. So, take that position with a grain of salt considering George Soros' recent comments. And for those of you tracking the precious metal's every move, check out this interesting technical analysis video on gold.

Of the positions they sold, the most notable is definitely Potash (POT). They completely exited their stake and it was previously one of their largest positions. They also exited LMDIA but keep in mind that they received new shares in DTV as a result of the merger transaction. Soros Fund Management continues to hold a large stake in Petroleo Brasileiro as they own both share classes. And while Soros sold off POT, they massively added to MON, another agricultural giant. Like many other hedge funds we've seen, Soros also added shares of Citigroup (C) in the fourth quarter. Soros also significantly boosted their stake in Pfizer, a stock we recently saw that was one of the top hedge fund holdings.

Overall though, some intriguing portfolio changes. To learn how to invest like George Soros, we recommend checking out his first book, The Alchemy of Finance. Data used for this article comes from Alphaclone, our source for backtesting strategies and sorting through all the hedge fund portfolio maneuvers with ease. Assets reported on the 13F filing were $8.8 billion this quarter compared to $6.2 billion last quarter, over a 40% increase in exposure. Remember that these filings are not representative of the hedge fund's entire base of AUM.

We'll be tracking 40+ prominent funds in our fourth quarter 2009 hedge fund portfolio tracking series. We've already covered Seth Klarman's Baupost Group, Mohnish Pabrai's Investment Fund, Carl Icahn's hedge fund Icahn Partners, David Einhorn's Greenlight Capital, Stephen Mandel's Lone Pine Capital, John Griffin's Blue Ridge Capital, David Tepper's Appaloosa Management, Warren Buffett's portfolio, John Paulson's hedge fund Paulson & Co, Lee Ainslie's Maverick Capital, Dan Loeb's Third Point, Eddie Lampert's RBS Partners, David Ott's Viking Global, and Chris Shumway's hedge fund Shumway Capital Partners, Chase Coleman's Tiger Global, Philip Falcone's Harbinger Capital Partners, Roberto Mignone's Bridger Management, Thomas Steyer's Farallon Capital, John Burbank's Passport Capital, and Brett Barakett's Tremblant Capital. Check back daily for our new updates.

blog comments powered by Disqus