Dan Loeb Likes Portuguese Sovereign Debt: Latest Exposure & Positioning ~ market folly

Tuesday, April 3, 2012

Dan Loeb Likes Portuguese Sovereign Debt: Latest Exposure & Positioning

Dan Loeb's Third Point Offshore Fund was up 1.5% for March and is up 6.5% for 2012. In the hedge fund's latest March exposure report, we see that Dan Loeb likes Portuguese Sovereign Debt, a position that had previously not been revealed.

Just last week we highlighted Loeb's comments at a distressed investing panel at Columbia Business School where he briefly mentioned he liked Portugal.

In March, that sovereign bond position was one of his top winners, along with Yahoo (YHOO), Family Dollar (FDO), Aveta, and Apple (AAPL). Loeb also recently engaged in a proxy fight with Yahoo and launched a website to raise investor awareness.

Third Point's Top Positions

1. Yahoo (YHOO)
2. Gold
3. Delphi
4. Eksportfinans ASA
5. Ally Financial

The fund's top holdings continue to be of distressed origination. Some of Third Point's losers from the month include: Barrick Gold (ABX), Genel Energy (LON:GENL), Gold, Volkswagen, and Ivanhoe Mines (IVN).

Latest Exposure Levels

Loeb's firm continues to enter 'risk on' mode as they are 38.5% net long equities (54.2% long, -15.7% short). This is slightly up from February's 36.7% net long exposure and way up from January when they were only net long 28.2%.

Their largest sector exposure continues to be technology via their activist YHOO stake. They are ever-so-slightly net short utilities.

In credit, Third Point is net long distressed by 7.6%, net long performing at 8.7%, net long asset backed securities at 14.5% and net short government at -13%. In total, they are 17.8% net long credit.

To read the investment theses behind some of their positions, head to Third Point's investor letter.

For more from Third Point's founder, head to lessons Dan Loeb has learned as an investor, our most popular post this year.

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