John Griffin's Blue Ridge Capital Loves Apple (AAPL): 13F Filing

This is the second quarter 2009 edition of our ongoing hedge fund portfolio tracking series. Before reading this update, make sure you check out our series preface on hedge fund 13F filings.

Next up is John Griffin's hedge fund Blue Ridge Capital. Griffin is very similar to Stephen Mandel (whom we also just covered) in that they were both some of Julian Robertson's top men at legendary hedge fund Tiger Management. They both went on to form their own funds and as such are labeled 'Tiger Cubs.' Griffin is most well known for his status as Robertson's former right hand man and he clearly knows what he's doing. Prior to that, he received his bachelor's degree from the University of Virginia and his MBA from Stanford. For more on Griffin you can check out our post of Tiger Cub biographies. Blue Ridge invests in companies that dominate their industries and shorts companies with fundamental problems in order to seek absolute returns. Griffin likes to hedge with an effective amount of both long and short positions like a hedge fund in the true sense of the definition.

For more on how to think and analyze like Griffin and Blue Ridge, check out their recommended reading lists. They've laid out their top reads in four categories presented below:

- Behavioral Finance recommendations
- Analytical recommendations
- Economics recommendations
- Historical/Biographical recommendations

Definitely check those out as there are some great suggestions from Blue Ridge in there to help you analyze financial markets and think like a prominent hedge fund manager such as John Griffin.

The following were Blue Ridge's long equity, note, and options holdings as of June 30th, 2009 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 from largest to smallest):
Pfizer (PFE), CME Group (CME), Schering Plough (SGP), Vale (VALE), Western Union (WU), State Street (STT), iShares Silver Trust (SLV), Express Scripts (ESRX), Partnerre (PRE), VMWare (VMW), Palm (PALM), Interoil (IOC), Wells Fargo (WFC), Redwood (RWT), Direxion 3x bear financials (FAZ), & American Capital (ACAS)


Some Increased Positions (A few positions they already owned but added shares to)
Blackrock (BLK): Increased by 100%
Range Resources (RRC): Increased by 89.4%
Apple (AAPL): Increased by 75.65%
Axis Capital Holdings (AXS): Increased by 38.7%
ThermoFisher Scientific (TMO): Increased by 23.5%


Some Reduced Positions (Some positions they sold some shares of)
Microsoft (MSFT): Reduced by 64.4%
Monsanto (MON): Reduced by 61.8%
Mastercard (MA): Reduced by 61%
Yamana Gold (AUY): Reduced by 54.3%
Newmont Mining (NEM): Reduced by 42.4%
National Oilwell Varco (NOV): Reduced by 41.1%
RenaissanceRe (RNR): Reduced by 34.4%
Amazon (AMZN): Reduced by 34.2%
Goldcorp (GG): Reduced by 33.2%
Berkshire Hathaway (BRK-A): Reduced by 31%


Removed Positions (Positions they sold out of completely)
SPDR S&P 500 (SPY) Calls, Vale (RIO), Amgen (AMGN), Target (TGT), Vornado Realty (VNO), Petroleo Brasileiro (PBR), Google (GOOG), Dell (DELL), Anadarko Petroleum (APC), Devon (DVN), Packaging Corp (PKG), iShares Biotech (IBB), Fomento Economico (FMX), Goodrich Petroleum (GDP), Calpine (CPN), Vimpelcomm (VIP). It also shows them selling out of General Growth Properties (GGWPQ), but this is only because the SEC has deemed it not necessary to report holdings in those shares anymore. (We touched on this when we covered Bill Ackman's portfolio). We now have no way of knowing if Blue Ridge still hold common shares or not.


Top 15 Holdings by percentage of assets reported on the 13F filing *(see note below)

1. Apple (AAPL): 7.3%
2. Millipore (MIL): 5.4%
3. Pfizer (PFE): 5.2%
4. CME Group (CME): 5.2%
5. ThermoFisher Scientific (TMO): 5.18%
6. Schering Plough (SGP): 4.8%
   
7. Visa (V): 4.7%
8. Microsoft (MSFT): 4.5%
9. Amazon (AMZN): 4.1%
10. Covanta (CVA): 3.73%
11. Vale (VALE): 3.7%
12. National Oilwell Varco (NOV): 3.7%
13. Blackrock (BLK): 3.43%
    
14. Discovery Communications (DISCA): 3.04%
15. Crown Castle (CCI): 2.63%
    

For all you Wall Street (the movie) fans out there, realize that we were very tempted to make the headline, 'Blue Horseshoe loves Apple,' but we refrained due to the fact that it would be a ridiculously bad joke. (Sidenote: the Wall Street sequel is coming for those of you unaware). At any rate, Blue Ridge Capital loaded up on shares of Apple (AAPL) in a big way, increasing their stake by over 75% and bringing it to their top holding. You can bet they're up big on this position as shares of AAPL have risen from $142 to $170 since June 30th when this portfolio snapshot was taken. Earlier this week, we also noted that David Stemerman's Conatus Capital held Apple as their top position. Shares of AAPL were certainly a theme over the past few quarters for many prominent hedge funds.

Blue Ridge also loaded up on shares of CME Group (CME), starting a brand new position and making it their 4th largest holding. Also worth noting is their brand new position of Western Union (WU), which they made their 17th largest holding. We mention this because John Griffin's hedge fund now owns Visa (V), Mastercard (MA), and Western Union (WU) all as top 20 holdings in their portfolio as they play the payment processing theme. While they brought on WU, they also cut their MA stake by 60%.

In terms of notable sales, they completely sold out of their SPDR S&P 500 (SPY) Calls position. That was previously a 5.8% stake for them and you have to believe they profited handsomely from it. From quarter-end to quarter-end (March 30th 'til June 30th), the S&P was up over 12.6%. We also wanted to highlight their 64% reduction in their Microsoft (MSFT) stake and their nearly 62% reduction in their Monsanto (MON) position.

It also appears if Blue Ridge has possibly been playing some risk arbitrage a bit with brand new positions in Pfizer (PFE) and Schering Plough (SGP), but there's no way for us to be sure. We only guess that solely because a ton of hedge funds have been buying shares of companies that are in the midst of some sort of merger or transaction. As the risk arbitrage space has dwindled due to fund redemptions and closures, newer funds have stepped onto the scene to pick up the pieces.

Lastly, we also wanted to highlight other recent activity from Blue Ridge where we see they established a new stake in PennyMac Mortgage (PMT).

*Note regarding portfolio percentages: Assets from the collective holdings reported to the SEC via 13F filing were $3.9 billion this quarter compared to $4.3 billion last quarter, so down slightly. Please keep in mind that when we state "percentage of portfolio," we are referring to the percentage of assets reported on the 13F filing. Since these filings only report longs (and not shorts or cash positions), the percentages are skewed. In reality, the percentages are more watered down in their actual hedge fund portfolio. If you were to calculate percentage weightings in the actual hedge fund portfolio, they would obviously be different since you would divide position sizes by their total assets under management.

This is just one of the 40+ prominent funds that we'll be covering in our Q2 2009 hedge fund portfolio series. So far, we've already covered the holdings of Bill Ackman's Pershing Square Capital Management, David Einhorn's Greenlight Capital, Seth Klarman's Baupost Group, Dan Loeb's Third Point LLC, and Stephen Mandel's Lone Pine Capital, George Soros (Soros Fund Management), Lee Ainslie's Maverick Capital, Philip Falcone's Harbinger Capital Partners, David Stemerman's Conatus Capital, and Eric Mindich's Eton Park Capital. Check back each day as we cover prominent hedge fund portfolios.

Blue Ridge Discloses New Stake In PennyMac Mortgage (PMT): 13G Filing

In a recent 13G filing with the SEC, John Griffin's hedge fund Blue Ridge Capital has disclosed a 9.5% ownership stake in PennyMac Mortgage Investment Trust (PMT). The filing was made due to activity on July 29th, 2009 and they now own 1,584,000 shares. PMT just recently IPO'd back on July 30th, with 16 million shares priced at $20.00 per share. Obviously, given that this was an IPO, this is a brand new position for Blue Ridge. John Griffin (pictured far right with mentor Julian Robertson) hasn't been very active in terms of SEC filings, as the last time we covered them in-depth was their Q1 2009 portfolio. And, seeing how 13F filings are pouring in this week and next, those positions will be updated.

One thing of interest from Blue Ridge recently though is their recommended reading lists. We posted up a compilation of their favorite books by category, which you can see below:

- Blue Ridge Capital's Recommended Analytical Reading

- Blue Ridge Capital's Recommended Historical/Biographical Reading

- Blue Ridge Capital's Recommended Behavioral Finance Reading

- Blue Ridge Capital's Recommended Economics Reading

There are some phenomenal reads on those lists and we highly recommending checking out a topic you fancy. John Griffin is well known because he served as the right-hand man to Julian Robertson while at Tiger Management. Griffin eventually left to found his own fund (Blue Ridge) and became one of the many 'Tiger Cub' hedge funds in existence today. Blue Ridge employs a fundamental bent by seeking companies that dominate their industries and shorting companies laced with fundamental problems. They seek absolute return through this strategy and Griffin likes to effectively hedge with a balanced book of both longs and shorts (like hedged fund in the true sense of the word... not like some of the crazy funds out there nowadays that aren't truly hedged).

Taken from Google Finance, PennyMac Mortgage Investment Trust is "a real estate investment trust. The Company operates as a specialty finance company that will invest primarily in residential mortgage loans and mortgage-related assets. The Company’s objective is to provide risk-adjusted returns to its investors over the long-term, primarily through dividends and secondarily through capital appreciation. The Company focuses on investing in mortgage loans, a substantial portion of which may be distressed and acquired at discounts to their unpaid principal balances."

John Griffin's Blue Ridge Capital Likes Microsoft (MSFT): 13F Filing Q1 2009

This is the 1st Quarter 2009 edition of our ongoing hedge fund portfolio tracking series. Before reading this update, make sure you check out the Hedge Fund 13F filings series preface.

Next up, we have John Griffin's Blue Ridge Capital. Now, Griffin is similar to Andreas Halvorsen of Viking Global and Stephen Mandel at Lone Pine Capital in that they are all 'Tiger Cubs' (pupils of Julian Robertson during their time at Tiger Management). Griffin though, is more well known because he was Julian Robertson's right hand man. So, needless to say, he knows his stuff.

Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems. Do note that the 13F filing only requires funds to disclose long positions (unless they are short via puts, we can see those). In the past, we have, however, gotten one sneak peek at what Blue Ridge has been shorting. Both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital like to effectively hedge with a solid balance of both long and short positions (like a true hedge fund... not like some of the crazy funds these days that aren't truly hedged).

Recently, we featured a multi-post series of readings recommended by Blue Ridge Capital. Their reading list is expansive and comprehensive, as it is broken down into four categories. We covered their lists of:

- Behavioral Finance recommendations
- Analytical recommendations
- Economics recommendations
- Historical/Biographical recommendations

We highly suggest checking out their suggestions as these lists are a great resource from a prominent and successful hedge fund.

John Griffin ahas numerous holdings in common with his mentor and ex-Tiger Management founder Julian Robertson. (Robertson has owned MA, V, AAPL, and MSFT as well). Griffin attended the University of Virginia for undergrad and received his MBA from Stanford. For more on Griffin you can check out our post of Tiger Cub biographies.

The following were Blue Ridge's long equity, note, and options holdings as of March 31st, 2009 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):
Range Resources (RRC)
Vale (RIO)
S&P500 Index ETF (SPY) Calls
Vornado Realty Trust (VNO)
Petrohawk (HK)
NovaGold Resources (NG)
Apple (AAPL)
RenaissanceRe (RNR)
Harley Davidson (HOG)
Whole Foods Market (WFMI)
Axis Capital (AXS)


Some Increased Positions (A few positions they already owned but added shares to)
General Growth Properties (GGP - now GGWPQ): Increased by 310%
Visa (V): Increased by 227%
Monsanto (MON): Increased by 194%
Google (GOOG): Increased by 191%
Target (TGT): Increased by 178%
Thermo Fisher Scientific (TMO): Increased by 160%
Microsoft (MSFT): Increased by 88%
Dell (DELL): Increased by 78%
Crown Castle (CCI): Increased by 77%
Exterran Holdings (EXH): Increased by 76%
Blackrock (BLK): Increased by 67%
Mastercard (MA): Increased by 34%
Millipore (MIL): Increased by 23%
National Oilwell Varco (NOV): Increased by 9%


Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
Agnico Eagle Mines (AEM): Reduced by 53%
Netflix (NFLX): Reduced by 47%
Yamana Gold (AUY): Reduced by 38%
Berkshire Hathaway (BRK-A): Reduced by 36%
Goldcorp (GG): Reduced by 29%
Newmont Mining (NEM): Reduced by 28%
Petroleo Brasileiro (PBR): Reduced by 26%
Broadridge Financial (BR): Reduced by 23%


Removed Positions (Positions they sold out of completely)
American Express (AXP)
XTO Energy (XTO)
SPDR Gold Trust (GLD)
Gold Miners ETF (GDX)
Grupo Televisa (TV)
Genentech (DNA)
KBR (KBR)
Valero (VLO)
Marathon Oil (MRO)
Aeroportuario del Pacifico (PAC)
iShares Mexico ETF (EWW)
Compton Petroleum (CMZ)
EOG Resources (EOG)


Top 15 Holdings (by % of portfolio)

1. Microsoft (MSFT): 8.68% of portfolio
2. Mastercard (MA): 6% of portfolio
3. S&P500 Index etf (SPY) Calls: 5.82% of portfolio
4. National Oilwell Varco (NOV): 4.94% of portfolio
5. Amazon (AMZN): 4.9% of portfolio
6. Millipore (MIL): 4.88% of portfolio
7. Monsanto (MON): 4.5% of portfolio
8. Visa (V): 4.45% of portfolio
9. Vale (RIO): 3.8% of portfolio
10. Amgen (AMGN): 3.45% of portfolio
11. Thermo Fisher Scientific (TMO): 3.3% of portfolio
12. Apple (AAPL): 2.76% of portfolio
13. Covanta (CVA): 2.59% of portfolio
14. Target (TGT): 2.5% of portfolio
15. Berkshire Hathaway (BRK-A): 2.47% of portfolio

There are a few major themes running through Blue Ridge's portfolio. Firstly, you'll notice the large presence of technology. John Griffin substantially boosted his holdings in Microsoft and Google, and started a new stake in Apple again (having owned the name in the past). Microsoft is by far his favorite play though, as it sits as their top holding. Also, while they are not technically technology plays, Mastercard and Visa's payment processing technology obviously has caught Griffin's eye as he now holds them as his 2nd and 8th largest holdings, respectively. These two names are featured quite prominently in numerous hedge fund portfolios, including many other Tiger Cub managers.

Secondly, we also noticed that Griffin was selling gold miner shares and sold completely out of his gold (GLD). This is interesting to note given the fact that we have seen numerous other hedge fund managers load up on gold and gold miners over the past 2 quarters. (Most notably David Einhorn, Eric Mindich, and Stephen Mandel, among others). As they say, 'there is always the other side of the trade'. And, it appears as if Blue Ridge was merely hiding out in gold until the storm passed, a tactic also used by Dan Loeb's Third Point LLC.

We also continue to notice the presence of Covanta (CVA), Monsanto (MON), and Millipore (MIL) in Blue Ridge's portfolio. These positions have been some of their core holdings for numerous quarters and it's safe to say they are longer term plays. They just boosted their stake in Monsanto this time around as well. Blue Ridge filed a 13G on Millipore (MIL) back in October of 2008 and continued to add to the position this quarter. However, they did get substantially reduce one of their other previously core positions. Last time around, Berkshire Hathaway was Blue Ridge's 3rd largest holding. In the first quarter of 2009 though, BRK-A is barely in their top-15.

Lastly, we saw one more thing that intrigued us. While they are not a huge chunk of their portfolio, Blue Ridge did indeed pick up some commercial real estate plays in Vornado (VNO) and General Growth (GGWPQ). Their VNO position is by far the larger of the two. Readers will be familiar with General Growth because another hedge fund titan, Bill Ackman, has a large position in GGP (new symbol: GGWPQ). So, they must see some value in these names.

Assets from the collective holdings reported to the SEC via 13F filing were $4.3 billion this quarter compared to $3.3 billion last quarter. So, overall, they were putting a lot more capital to work on the long side this time around. This is just one of the 40+ prominent funds that we'll be covering in our hedge fund Q1 2009 portfolio series. Check back each day as we cover new fund portfolios. We've already covered Andreas Halvorsen's Viking Global, John Paulson's hedge fund Paulson & Co, Stephen Mandel's Lone Pine Capital, and Eric Mindich's Eton Park Capital.

Blue Ridge Capital's Behavioral Finance Recommended Reading List

This is the fourth and final installment of hedge fund Blue Ridge Capital's recommended reading list. Previously, we've revealed Blue Ridge's recommended Analytical Reading List, their Historical/Biographical List, and their Economics List. This week, we'll turn to their recommended Behavioral Finance reads.

Long-time blog readers will know that we track Blue Ridge because they are the pure definition of a 'Tiger Cub'.   John Griffin was Julian Robertson's right-hand man while at Tiger Management before founding Blue Ridge.


Behavioral Finance

Investment Psychology Explained: Classic Strategies to Beat the Market by Martin Pring: A 'back to basics' book on how to beat the market.

Beyond Greed and Fear by Hersh Shefrin: A look at how bias, perception, and psychology run the stock market. 

The Money Game by Adam Smith: Book hypothesizing that the stock market is just a game; explains technical analysis, fundamental analysis, psychology, and more. 

Influence: The Psychology of Persuasion by Robert Cialdini: Understanding the foundation of persuasion and marketing.

The Inefficient Stock Market by Robert Haugen: 'What works and why.' This book looks at how the market is inefficient and argues that financial models based on economic behavior cannot explain certain aspects of (often irrational) market behavior.

Why Smart People Make Big Money Mistakes by Gilovich & Belsky: Close examination of the psychological reasons behind how and why people invest, spend, and save.

The Psychology and Judgment of Decision Making by Scott Plous: Examination of your own psychology of decision making.

How We Know What Isn't So by Thomas Gilovich: Focuses on errors humans make when forming opinions and trying to comprehend things.

Decision Traps: 10 Barriers to Brilliant Decision Making by J. Russo: Training to become a good decision-maker (one of the most important business skills out there). 

Extraordinary Popular Delusions and the Madness of Crowds by Tobias & McKay: A book discussing "the herd mentality" at its finest, where the masses collectively assemble and follow each other like lemmings.

Hare Brain, Tortoise Mind by Guy Claxton: How to handle complex situations by way of perception, problem solving, and creativity. 

The Moral Animal: Why We Are the Way We Are by Robert Wright: Evolutionary psychology and human nature.


That finishes up the Behavioral Finance category and also concludes Blue Ridge's recommendations. If you've missed some of our past lists, here is our archived compendium.


Recommended Reading Lists

- Blue Ridge Capital's Recommended Analytical Reading

- Blue Ridge's Recommended Historical/Biographical Reading

- Blue Ridge Capital's Recommended Economics Reading

- Fundamentals

- Technical analysis

- Good Market Reads

- Gurus

- John Burbank's hedge fund Passport Capital: Suggested Reading List



Background on Blue Ridge:

Griffin is a Tiger Cub, and as mentioned above, he was Julian Robertson's right hand man. So, needless to say, he knows his stuff. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems. While hedge funds typically closely guard their short positions, we've gotten a sneak peek in the past at what Blue Ridge had been shorting. Both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital like to effectively hedge with a solid balance of both long and short positions (like a true hedge fund... not like some of the crazy funds these days that aren't truly hedged). Griffin attended the University of Virginia for undergrad and received his MBA from Stanford.

Blue Ridge Capital's Recommended Economics Reading List

Time for the third installment in our series of 4 articles revealing Blue Ridge Capital's recommended reading list. Previously, we've revealed Blue Ridge's recommended Analytical Reading List, as well as their Historical/Biographical List. This week, we'll turn to their recommended Economics books.

Long-time blog readers will know that we track Blue Ridge because they are the pure definition of a Tiger Cub. Founder John Griffin was Julian Robertson's right-hand man while at Tiger Management and was one of the first to strike out on his own.



Economics

Capitalism and Freedom by Milton Friedman: A must-read by one of the most well-known economists out there.

The Lexus and the Olive Tree by Thomas Friedman: A book that deals with understanding globalization and argues that globalization (the Lexus) is "the central organizing principal of the post-cold war world."

Economics in One Lesson by Henry Hazlitt: With an introduction by Steve Forbes, this book is a great primer on economic thinking.

Eat the Rich by PJ O'Rourke: A tour of two years worth of economic practice, focusing on good capitalism and bad capitalism, among other things.


Other

How To Win Friends and Influence People by Dale Carnegie: The "grandfather of all people-skills books." It details fundamental techniques and principles for dealing and interacting with people.

Atlas Shrugged by Ayn Rand: Not only recommended by Blue Ridge, but by many other hedge fund managers out there, this book deals with philosophy of objectivism.

The Tao Jones Averages by Bennett Goodspeed: Touches on the mindset required to succeed as an investor.

The Tao of Pooh by Benjamin Hoff: Despite the somewhat silly title, this book examines what a Western Taoist is.

The Te of Piglet by Benjamin Hoff: Similar to the above, this book examines the Taoist embodiment of Te, or virtue.

Nonzero: The Logic of Human Destiny by Robert Wright: Address the convtroversial question of 'purpose in evolution.'


That completes their Economics and 'Other' recommendations from hedge fund Blue Ridge Capital.  Check out the rest of their recommendations in the categories below:

- Blue Ridge's Recommended Analytical Reading

- Blue Ridge's Recommended Historical/Biographical Reading

- Blue Ridge's favorite behavioral finance books



Background on Blue Ridge:

Griffin is a Tiger Cub, and as mentioned above, he was Julian Robertson's right hand man. So, needless to say, he knows his stuff. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems.

Both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital like to effectively hedge with a solid balance of both long and short positions (like a true hedge fund... not like some of the crazy funds these days that aren't truly hedged). Griffin attended the University of Virginia for undergrad and received his MBA from Stanford.

Blue Ridge Capital's Recommended Reading List: Historical & Biographical Edition

This is the second post in our series of four articles divulging recommended reading from John Griffin's hedge fund Blue Ridge Capital.  Last week, we looked at Blue Ridge's recommended Analytical Reading List, which was full of many great books. This week, we'll turn to their Historical & Biographical list.



Biographical/Historical

The Money Masters ( as well as The New Money Masters) both by John Train: Covers experts on various schools of investing thought: growth, value, emerging markets, turnarounds, top-down, bottom-up, and more.

No Bull by Michael Steinhardt: Autobiography by one of the first true hedge fund managers out there. His firm survived the collapse of the 1960's.

Soros on Soros: Staying Ahead of the Curve by George Soros: An interview with Soros (an entire book's worth) regarding his investment philosophies and more.

Wall Street: A History by Charles Giesst

Where Are the Customers' Yachts? by Fred Schwed: Humorous and entertaining book about the hypocrisy and folly of Wall Street (sounds like our kind of book!)

The New Market Wizards & Interviews With Top Traders both by Jack Schwager (and staples on our reading list): Inside look at some of the best traders in the game, including many fund managers who we cover on the blog

Reminiscences of a Stock Operator by Edwin Lefevre (also on our previous lists): Takes you inside the mind of a trading and provides tons of trading wisdom and insight.

Classic II: Another Investor's Anthology by Ellis & Vertin:

The Great Game by John S. Gordon: History of how New York became the world's "preeminent financial power."


Famous First Bubbles by Peter Garber: Explanations of the three most famous bubbles in history: Dutch Tulips, Mississippi Buble, and the South Sea Bubble.

Chainsaw: The Notorious Career of Al Dunlap by John Byrne: Documentation of the rise and fall of a man known for downsizing corporations for short-term shareholder gain.


The Essays of Warren Buffett by the Oracle himself: Lessons from Warren Buffett over the years.


Go-Go Years: Drama and Crashing Finale of Wall Street's Bullish 60s by John Brooks: A look at the rise of growth stocks in the 1960's that led to the ultimate fall in the 1970's.


Baruch: My Own Story by Bernard Baruch



There you have it, Blue Ridge's recommended historical and biographical works. Be sure to also check out the hedge fund's favorite picks in the following categories below:

- Blue Ridge Capital's recommended Analytical Reading

- Blue Ridge's favorite Behavioral Finance books

- Blue Ridge's recommended Economics reading




Background on Blue Ridge:

Griffin is a Tiger Cub, and as mentioned above, he was Julian Robertson's right hand man. So, needless to say, he knows his stuff. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems.

Both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital like to effectively hedge with a solid balance of both long and short positions (like a true hedge fund... not like some of the crazy funds these days that aren't truly hedged). Griffin attended the University of Virginia for undergrad and received his MBA from Stanford.

Blue Ridge Capital's Recommended Reading List: Analytical Category

Today we're starting a series of recommended reading from John Griffin's hedge fund Blue Ridge Capital.  Griffin was Julian Robertson's right-hand man while at Tiger Management before founding Blue Ridge.

Their reading list is quite extensive and broken up into four different categories. As such, we're going to post each category separately with links to others found at the bottom. Without further ado:


Blue Ridge Capital's Analytical Recommended Reading



The Art of Short Selling by Kathryn Staley: Examples and instructions on how to find overpriced stocks and profit from their decline.

Financial Shenanigans: How to Detect Accounting Gimmicks by Howard Schilit: How to identify inflated profits, suspicious write-offs, and shifted expenses.

A Random Walk Down Wall Street by Burton Malkiel: A great investing guide covering all asset classes.

One Up On Wall Street by Peter Lynch: A classic with contributions from John Rothchild as well.

The Warren Buffett Way by Robert Hagstrom: Outline of Buffett's tenets for investing.

Security Analysis by Graham & Dodd): Hands down THE best book on fundamental analysis and value investing principles.

Common Stock and Uncommon Profits by Philip Fisher: Investment philosophies from a widely regarded investor.

Winning the Loser's Game: Timeless Strategies for Successful Investing by Charles Ellis: Growing with the markets, rather than fighting them: Topics ranging from compounding to fighting down-cycles.


Built to Last: Successful Habits of Visionary Companies by Collins & Porras: Evaluation of what makes companies "great" and how to spot those with solid products, a great brand, and a bright future.

Against the Gods by Peter Bernstein: Comprehensive guide to understanding risk and probability throughout history.


As you can see, quite a lengthy and comprehensive compilation... and that's only one of Blue Ridge's lists. Below are their recommendations in the following categories:

- Blue Ridge's recommended behavioral finance reading

- Blue Ridge's recommended Economics reading

- Blue Ridge's recommended historical/biographical reading


Background on Blue Ridge:

Griffin is a Tiger Cub, and as mentioned above, he was Julian Robertson's right hand man. So, needless to say, he knows his stuff. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems. Both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital like to effectively hedge with a solid balance of both long and short positions (like a true hedge fund... not like some of the crazy funds these days that aren't truly hedged). Griffin attended the University of Virginia for undergrad and received his MBA from Stanford.

John Griffin's Blue Ridge Capital 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, we have John Griffin's Blue Ridge Capital. Now, Griffin is similar to Stephen Mandel at Lone Pine Capital, Andreas Halvorsen at Viking Global, and Lee Ainslie at Maverick Capital in that they all are 'Tiger Cubs' (a.k.a. pupils of Julian Robertson while at Tiger Management). Griffin though, is more well known because he was Julian Robertson's right hand man. So, needless to say, he knows his stuff. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems. Do note that the 13F filing only requires funds to disclose long positions (unless they are short via puts, we can see those). In the past, we have, however, gotten one sneak peek at what Blue Ridge has been shorting. Both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital like to effectively hedge with a solid balance of both long and short positions (like a true hedge fund... not like some of the crazy funds these days that aren't truly hedged).

Griffin attended the University of Virginia for undergrad and received his MBA from Stanford. Recently, the University of Virginia hosted a hedge fund panel which consisted of many of the 'Tiger Cubs' as well as the founder of Tiger Management, Julian Robertson. At the panel, numerous hedge fund managers laid out some of their investment theses. Additionally, we noted that in the past, Blue Ridge has disclosed a 5.47% stake in Millipore (MIL).

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):
Microsoft (MSFT)
National Oilwell Varco (NOV)
Mastercard (MA)
Genentech (DNA)
Petrobras (PBR)
XTO Energy (XTO)
Agnico Eagle Mines (AEM)
Discovery Communications (DISCA)
Devon Energy (DVN)
American Express (AXP)
Yamana Gold (AUY)
Market Vectors Gold Miners (GDX)
Monsanto (MON)
Discovery Communications (DISCK)
Newmont Mining (NEM)
Goldcorp (GG)
Crown Castle (CCI)
Dell (DELL)
Ishares Biotech (IBB)
Calpine (CPN)
Blackrock (BLK)
Google (GOOG)
Valero (VLO)
Marathon Oil (MRO)
KBR (KBR)
EOG Resources (EOG)
Wynn Resorts (WYNN)
iShares Mexico (EWW)
VimpelComm (VIP)
General Growth Properties (GGP)


Some Increased Positions (A few positions they already owned but added shares to)
Amgen (AMGN): Increased position by 182%
Greenlight Capital Re (GLRE): Increased position by 150%
Amazon (AMZN): Increased position by 26%
Berkshire Hathaway (BRK-A): Increased position by 18%
SPDR Gold Trust (GLD): Increased position by 16%
Goodrich Petroleum (GDP): Increased position by 15.9%
Millipore (MIL): Increased position by 11.9%
Covanta (CVA): Increased position by 8%


Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
Compton Petroleum (CMZ): Reduced position by 94.8%
Grupo Televisa (TV): Reduced position by 80.9%
Target (TGT): Reduced position by 71%
Anadarko Petroleum (APC): Reduced position by 51%
Exterran Holdings (EXH): Reduced position by 43%
Thermo Fisher Scientific (TMO): Reduced position by 42%
Fomento Economico (FMX): Reduced position by 33.9%
Visa (V): Reduced position by 30%
Grupo Aeroportuario Pacifico (PAC): Reduced position by 14%


Removed Positions (Positions they sold out of completely)
Washington Mutual (WM) Puts
Perfect World (PWRD)
Elong (LONG)
Gold Reserve (GRZ)
Wachovia (WB-PT) Preferred T
Foster Wheeler (FWLT)
Las Vegas Sands (LVS)
Lululemon (LULU)
Goldman Sachs (GS)
Illumina (ILMN)
American Express (AXP) Calls
Eagle Materials (EXP)
MBIA (MBI)
Discovery Holdings (DSY)
Martin Marietta (MLM)
Hansen Natural (HANS)


Top 20 Holdings (by % of portfolio)

1. Microsoft (MSFT): 6.3% of portfolio
2. Covanta (CVA): 5.63% of portfolio
3. Berkshire Hathaway (BRK-A): 5.58% of portfolio
4. National Oilwell Varco (NOV): 4.99% of portfolio
5. Mastercard (MA): 4.94% of portfolio
6. Amgen (AMGN): 4.68% of portfolio
7. Millipore (MIL): 4.58% of portfolio
8. Amazon (AMZN): 4.42% of portfolio
9. Genentech (DNA): 3.67% of portfolio
10. SPDR Gold Trust (GLD): 3.22% of portfolio
11. Petroleo Brasileiro (PBR): 2.78% of portfolio
12. XTO Energy (XTO): 2.57% of portfolio
13. Broadridge Financial (BR): 2.47% of portfolio
14. Agnico Eagle Mines (AEM): 2.36% of portfolio
15. Discovery Communications (DISCA): 2.21% of portfolio
16. Devon Energy (DVN): 2.18% of portfolio
17. American Express (AXP): 2.16% of portfolio
18. Yamana Gold (AUY): 1.9% of portfolio
19. Market Vectors Gold Miners (GDX): 1.78% of portfolio
20. Monsanto (MON): 1.68% of portfolio
    

They added Microsoft in a big way last quarter, starting it as a new position and bringing it all the way up to their top holding. Like Maverick, we also see that Blue Ridge sees value in Berkshire Hathaway here. And, like David Einhorn and Greenlight, they also like Gold and Gold Miners here. Assets from the collective long US equity, options, and note holdings were $2.6 billion last quarter and were $3.39 billion this quarter. 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 Paulson & Co (John Paulson), Carl Icahn, Warren Buffett, Stephen Mandel's Lone Pine Capital, George Soros, Bill Ackman's Pershing Square, Andreas Halvorsen's Viking Global, Timothy Barakett's Atticus Capital, David Einhorn's Greenlight Capital, Seth Klarman's Baupost Group, Peter Thiel's Clarium Capital, Bret Barakett's Tremblant Capital, David Stemerman's Conatus Capital, James Pallotta's Raptor Capital Management, and Lee Ainslie's Maverick Capital. Look for our updates as we will be covering a new fund each day.

Hedge Fund Tracking: John Griffin's Blue Ridge Capital - 13F Filing 3rd Quarter 2008

This is the 3rd Quarter 2008 edition of our ongoing hedge fund tracking series. Before reading this update, make sure you check out the preface to the series we're doing on Hedge Fund 13F's here. We're aiming to cover 35 or so prominent funds this time around and we'll be releasing the 13f analysis of each individual fund here in the coming weeks. We've already covered Whitney Tilson's T2 Partners, Peter Thiel's Clarium Capital, Bill Ackman's Pershing Square, Stephen Mandel's Lone Pine Capital, Lee Ainslie's Maverick Capital, and Timothy Barakett's Atticus Capital. Next up, we have John Griffin's Blue Ridge Capital. Now, Griffin is similar to Stephen Mandel at Lone Pine Capital and Lee Ainslie at Maverick Capital in that they all are 'Tiger Cubs' (a.k.a. pupils of Julian Robertson while at Tiger Management). Griffin though, is more well known because he was Julian Robertson's right hand man. So, needless to say, he knows his stuff. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems. And, right off the bat that presents us with a bit of a problem in terms of analyzing 13F's. 13F's don't show short positions, they show long positions (unless the firm is short through puts, which we *can* see). So, the inherent problem with analyzing Blue Ridge (or any fund for that matter) is that we can't see the other side of their portfolio. But, this is increasingly important for Blue Ridge simply due to Griffin's investment strategy and the fact that his short positions are equally or more important than his longs. We have, however, gotten one sneak peek at what Blue Ridge has been shorting. Both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital like to effectively hedge with a solid balance of both long and short positions (like a true hedge fund... not like some of the crazy funds these days that aren't truly hedged).

Griffin attended the University of Virginia for undergrad and received his MBA from Stanford. Recently, the University of Virginia hosted a hedge fund panel which consisted of many of the 'Tiger Cubs' as well as the founder of Tiger Management, Julian Robertson. At the panel, numerous hedge fund managers laid out some of their investment theses. Additionally, we noted that Blue Ridge recently disclosed a 5.47% stake in Millipore (MIL) and Julian Robertson had recently bought some stocks to hedge his overall short portfolio.

Now, onto the 13F. We'd like to thank Alex Prywes for their help in our 13F tracking series as it has allowed us to cover more funds. Before beginning, we'd like to suggest that you check out Blue Ridge's portfolio from last quarter, so you can get a feel for how they're altering their portfolio. The following were Blue Ridge's long equity and options holdings as of September 30th, 2008 as filed with the SEC.


New Positions (Brand new positions that they initiated in the last quarter):
Hansen Natural (HANS): 3.6% of portfolio
SPDR Gold Trust (GLD): 3.49% of portfolio
Illumina (ILMN): less than 1% of portfolio
Goldman Sachs (GS): less than 1% of portfolio
Lululemon (LULU): less than 1% of portfolio
Las Vegas Sands (LVS): less than 1% of portfolio
Foster Wheeler (FWLT): less than 1% of portfolio
Wachovia (WB): less than 1% of portfolio


Added to (Positions they already owned but added more shares)
Amazon (AMZN): Increased position by 146%
Goodrich Petroleum (GDP): Increased position by 108%
Berkshire Hathaway (BRK.A): Increased position by 97%
Target (TGT): Increased position by 47%
Echostar (SATS): Increased position by 35%
Thermo Fisher Scientific (TMO): Increased position by 27.6%
Anadarko Petroleum (APC): Increased position by 24%
Grupo Televisa (TV): Increased position by 20%


Reduced Positions (Positions they sold some shares of)
Amgen (AMGN): Sold off 85%
Charles Schwab (SCHW): Sold off 70%
Martin Marietta (MLM): Sold off 55%
Netflix (NFLX): Sold off 50%
Grupo Aeroportuario del Pacifico (PAC): Sold off 49%
Exterran Holdings (EXH): Sold off 47.6%
Discovery Holding (DSY): Sold off 41.5%
Eagle Materials (EXP): Sold off 41%
Packaging Corp (PKG): Sold off 30%
Broadridge Financial Solutions (BR): Sold off 11%
Compton Petroleum (CMZ): Sold off 11%
Visa (V): Sold off 10.4%
Fomento Economico Mexicano (FMX): Sold off 9%


Positions with no change
Covanta (CVA)
Millipore (MIL)
MBIA (MBI)
American Express (AXP) Calls
Greenlight Capital RE (GLRE)
Gold Reserve Inc (GRZ)
Elong (LONG)
Perfect World (PWRD)
Washington Mutual (WM) Puts


Removed Positions (Positions they sold out of completely)
Apple (AAPL)
American Express (AXP): They sold all their common shares, but still hold Calls, as noted above
Bare Escentuals (BARE)
Countrywide Financial
Crocs (CROX)
Fairfax Financial (FFH)
Fannie Mae (FNM)
Freddie Mac (FRE)
First Marblehead (FMD)
Google (GOOG)
Indymac (IDMCQ)
Nutrisystem (NTRI)
Research in Motion (RIMM)
Rowan (RDC)
Vulcan Materials (VMC)
Walmart (WMT)
Wyeth (WYE)


Top 20 Holdings (by % of portfolio)

1. Berkshire Hathaway (BRK.A): 8.13% of portfolio
2. Grupo Televisa (TV): 7.6% of portfolio
3. Target (TGT): 7.44% of portfolio
4. Covanta (CVA): 7.2% of portfolio
5. Millipore (MIL): 7% of portfolio
6. Amazon (AMZN): 6.4% of portfolio
7. ThermoFisher (TMO): 5.6% of portfolio
8. Anadarko (APC): 5.3% of portfolio
9. Broadridge Financial (BR): 3.7% of portfolio
10. Hansen Natural (HANS): 3.6% of portfolio
11. Visa (V): 3.6% of portfolio
12. SPDR Gold Trust (GLD): 3.5% of portfolio
13. Fomento Economico Mexicano (FMX): 2.67% of portfolio
14. Echostar (SATS): 2.6% of portfolio
15. Martin Marietta (MLM): 2.6% of portfolio
16. Charles Schwab (SCHW): 2.5% of portfolio
17. Packaging Corp (PKG): 2.5% of portfolio
18. Discovery Holdings (DSY): 2.2% of portfolio
19. Goodrich Petroleum (GDP): 2.2% of portfolio
20. Amgen (AMGN): 2.17% of portfolio
    

Assets listed in the long portfolio this quarter were a little over $2.6 billion compared to around $4 billion last quarter. Keep in mind that these filings only include long equity and options holdings and do not reflect the cash or short portions of their portfolio. This is the eighth hedge fund we've covered in our 3rd quarter 2008 edition of our hedge fund tracking series in which we're tracking 35+ prominent funds. We've already covered Whitney Tilson's T2 Partners, Peter Thiel's Clarium Capital, Bill Ackman's Pershing Square, Stephen Mandel's Lone Pine Capital, Lee Ainslie's Maverick Capital, and Timothy Barakett's Atticus Capital. Overall, its been one of the worst years ever for hedge funds, as we noted in our recent October hedge fund performance update. Thus, the recent moves they've made in their portfolios become all the more interesting given the way the market has played out.

More on Griffin & Blue Ridge:
- Blue Ridge discloses stake in Millipore (MIL)
- 'Tiger Cub' hedge fund panel (investment ideas)
- Blue Ridge is/was shorting UK banks
- Blue Ridge's 2nd quarter '08 portfolio
- John Griffin & Rick Gerson biographies
- Julian Robertson reveals some purchases

Hedge Fund Panel: Tiger Management / Tiger Cubs

Buck Woodford, author of ManyPeaks and Portfolio Manager of Teewinot Asset Management recently attended a discussion at the University of Virginia entitled "Investment Strategies in Turbulent Times," which consisted of a panel of five very prominent and successful hedge fund managers. The panel featured many ex-Tiger Management greats, including founder Julian Robertson. Also on board were some of his "Tiger Cubs," Paul Touradji, Chris Shumway, Rick Gerson (Blue Ridge Capital), and John Griffin (Blue Ridge). In the discussion, each was asked to present their best current investment thesis.

Here are their ideas as written by Buck,

"Chris Shumway said that buying stocks that were down huge primarily based mostly on hedge fund liquidations would be a long-term winning strategy. It’s always debatable why a stock is down, but this does make fundamental sense.

Paul Touradji layed out a thesis for shorting copper. He believes that base metals are priced based on the “velocity of money” - a measurement that’s likely to drop as the world generally de-leverages. Fair enough.

Julian - believe it or not - was bullish on a particular derivative bet. He believes the interest rate yield curve will steepen significantly, and discussed “steepener swaps” as his favorite investment right now. While chuckling, Griffin said that when Julian called to tell him about the idea, Julian joked that in his family this Christmas there would be “a steepener in every stocking.” Us finance people are really easily entertained.

Rick Gerson made a good point that United States corporations had really gone down the road of “professional” management — he compared it to outsourcing. Naming a few middle eastern companies that he deemed good investments, Rick made the case that in these frontier markets there are still plenty of “owner/operator” public companies in which the people running the show retain 70-80% ownership. He presumably has some of Blue Ridge’s money allocated to these situations.

John Griffin did not share any specific security that he liked, but ruminated that what he’d really like is the ability to “arbitrage time.” Basically that in a world dominated by short-term thinking, it’s hard to take a stand on a company or stock because even if you’re eventually right, the losses you may sit on during the interim can cause both your investors and employees to get hot & bothered. I hear what he’s saying, but that’s just the fact of life with public/listed company investing. If you don’t want a daily price quote, you’ve just got to get big enough (or partner with other funds) to buy the whole company and take it private. The practice of not marking to market is a different game."

Big thanks to Buck for his coverage of the event. If you are unfamiliar with some of the men mentioned above, or were just wanted more background on them, here are their biographies.

And, if you've missed them, we track numerous "Tiger Cub" hedge fund portfolios on the blog, including John Griffin's Blue Ridge Capital here, Stephen Mandel's Lone Pine Capital here, and Lee Ainslie's Maverick Capital here. Additionally, we noted that Julian Robertson recently made a media appearance in which he detailed some of his recent purchases.

Tiger Managment / Tiger Cub Biographies

This post is a supplement to our recent post on the Hedge Fund Panel, featuring numerous ex-Tiger Management and "Tiger Cub" fund managers. Here are their biographies as taken from the event announcement:

Rick Gerson

Rick Gerson is a Managing Director of Blue Ridge Capital. He was a founding member of the firm, which has been in operation since 1996. Mr. Gerson has been an integral part of the firm's investments since its inception in a wide variety of securities globally. Mr. Gerson is a Co-Founder of Blue Ridge China, a private equity firm that focuses on investments in China. He is a board member of Orascom Housing Communities, an Egypt-based homebuilder. Mr. Gerson has a B.S. from the University of Virginia's McIntire School of Commerce.

John Griffin

Education

• M.B.A., Stanford University Graduate School of Business (1990)
• B.S. in Finance, University of Virginia, McIntire School of Commerce (1985)

Professional

• President and Founder of Blue Ridge Capital
• President of Tiger Management (1993 – 1996)
• Portfolio Manager, Tiger Management (1994 – 1996)
• Analyst, Tiger Management (1987 – 1994)
• Financial Analyst, Morgan Stanley Merchant Banking Group (1985 – 1987)

Academic, Philanthropic, and Community Activities

• Visiting Professor, University of Virginia, 1999-present. Classes taught include Securities Analysis and Idea Generation; Practical Behavioral Finance and The Analyst’s Edge
• Adjunct Professor of Finance, Columbia Business School, 1998-present. Class: Seminar in Advanced Investment Research: The Analyst’s Edge
• Member, Board of Directors, Michael J. Fox Foundation for Parkinson’s Research
• Founder of iMentor.org, a nonprofit online mentoring organization
• Founder of the Blue Ridge Foundation, which funds start-up, nonprofits
• Chairman of the Tiger Foundation 1992-1995, board member 1990 – present
• Chairman of the University of Virginia McIntire School of Commerce Foundation
• Member of Board of Trustees, Monticello (Charlottesville, Va.)

Julian Robertson

Julian H. Robertson Jr. is an investor, environmentalist, and philanthropist.

Mr. Robertson was born in Salisbury, N.C., in 1932. After graduating from the Episcopal High School in Alexandria, Va., in 1951 and the University of North Carolina in 1955, he served as an officer in the U.S. Navy.

Prior to co-founding Tiger in 1980, Mr. Robertson enjoyed a two-decade career with Kidder Peabody and Company, beginning as a sales trainee and rising to become CEO of Webster Management Corporation, Kidder Peabody’s investment advisory subsidiary.

From initial capital of $8 million, Mr. Robertson built Tiger into the world’s largest hedge fund, with capital of more than $23 billion. Tiger compounded at a gross rate of 31.5% between its founding in 1980 and its closing in 2000.

Mr. Robertson also trained and developed a generation of “Tiger Cubs,” a cadre of analysts and portfolio managers who became some of today’s most successful hedge fund managers. Today, Mr. Robertson maintains Tiger to manage his own investments and to seed independent hedge funds, run by high-achieving young managers.

Chris Shumway

Chris Shumway is the Founding Partner of Shumway Capital Partners (“SCP”), an investment management firm founded in 2001. SCP, which manages a multibillion dollar group of private investment funds, uses a private equity-like research model for public market investment on a global basis. Prior to forming SCP, Mr. Shumway was a Senior Managing Director at Tiger Management (1992-1999), an Analyst at Brentwood Associates (1990-1991), and an Analyst at Morgan Stanley & Co. (1988-1990). He received an M.B.A. from Harvard Business School (1993) and a B.S. from the McIntire School of Commerce at the University of Virginia (1988). Mr. Shumway is a member of the boards of the McIntire School of Commerce Foundation (University of Virginia), Teach for America-Connecticut (Fairfield County), and The Shumway Capital Foundation.

Paul Touradji

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.

John Griffin's Blue Ridge Capital Files 13G on Millipore (MIL)

According to a 13G filing made with the SEC on October 16th, Blue Ridge Capital ran by John Griffin has disclosed a 5.47% ownership stake in Millipore (MIL). Blue Ridge disclosed that they now own 3,020,000 shares of MIL as of October 6th. This is an increase from their position that they disclosed in their most recent 13F, which had revealed their positions as of June 30th. Back then, they owned 2,700,000 shares. Since then, they have accumulated 320,000 more shares to bring them to their current holding of a 5.47% ownership stake in MIL. You can see the rest of Blue Ridge's portfolio holdings here. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems.

Taken from Google Finance, Millipore (MIL) is "a life science company that provides products, services and solutions. The Company’s academic, biotechnology, and pharmaceutical customers use its consumable products and services in laboratory applications and in biopharmaceutical manufacturing."

You can view the 13G as filed with the SEC here.

Julian Robertson Reveals Some Buys

Monday (10/13) on CNBC, Julian Robertson, legendary investor and founder of notable hedge fund Tiger Management revealed some purchases he made in the market carnage last week. His buys included:

• Apple (AAPL)
• Microsoft (MSFT)
• Baidu (BIDU)
• Mastercard (MA)
• Visa (V)
• Ryan Air Holdings (RYAAY)

His argument, being a notable value player, was that these equities were trading at very favorable prices. Yet, at the same time, he curiously noted that he thought the US was just now entering into a period of prolonged recession (possibly 10-15 years). He thinks that this time around, consumers are broke and will be forced to cut their spending. Interesting thoughts when you compare them to the purchases he just made.

And, it seems that Robertson is fond of some of his progeny's favorite stocks as well. Robertson is well known for the 'descendants' that left Tiger Management to start their own firms. Many of Julian's "offspring" (referred to as Tiger Cubs) whom we track here at Market Folly, have had large positions in AAPL, BIDU, MA, and V as disclosed in various 13F quarterly filings. Notable Tiger Cubs include Lee Ainslie at Maverick Capital, Stephen Mandel at Lone Pine Capital, and John Griffin at Blue Ridge Capital. As of the last disclosures, AAPL was Maverick's top portfolio holding. Blue Ridge also held AAPL as their 4th largest portfolio holding. We track all these funds (and more) through the most recent 13F filings with the SEC and you can view Maverick's portfolio here, Lone Pine's portfolio here, and Blue Ridge's portfolio here.

Hedge Fund Tracking: Blue Ridge Capital's 13F (John A. Griffin)

(Note: Before reading this update, make sure you check out the preface to the series I'm doing on Hedge Fund 13F's here).

The 13F breakdowns are really flowing now and if you've missed them, I've already covered Jeffrey Gendell's Tontine Partners here, Bret Barakett's Tremblant Capital here, and Peter Thiel's Clarium Capital here. Next up, we have one of my personal favorites: Blue Ridge Capital ran by John A. Griffin. Now, Griffin is similar to Steve Mandel at Lone Pine Capital and Lee Ainslie at Maverick Capital in that they all are 'Tiger Cubs' (a.k.a. pupils of Julian Robertson while at Tiger Management). Griffin though, is more well known because he was Julian Robertson's right hand man. So, needless to say, the dude knows his stuff. Blue Ridge seeks absolute returns by investing in companies who dominate their industries and shorting the companies who have fundamental problems. And, right off the bat that presents us with a bit of a problem in terms of analyzing 13F's. 13F's don't show short positions, they show long positions (unless the firm is short through puts, which we *can* see). So, the inherent problem with analyzing Blue Ridge (or any fund for that matter) is that we can't see the other side of their portfolio. But, this is increasingly important for Blue Ridge simply due to Griffin's investment strategy and the fact that his long positions could in essence only represent half of the portfolio. Now, I use that loosely because there's no way for me to know exactly how much of his portfolio is short. But, I do know that both Griffin at Blue Ridge and Lee Ainslie over at Maverick Capital (research on him coming later this week) like to effectively hedge with a balance of both long and short positions (like a TRUE hedge fund... not like some of these crazy funds these days with no true hedging). Here's the thing: they don't do pairs trades, so don't classify it as that. In the past, I remember specifically being told by representatives at Maverick that they don't pairs trade, even though a respective long and short could be in the same sector or sub-sector. So, make that distinction clear. But, we'll work with what we've got (and believe me, it's still a lot of solid info).

Before beginning, I would like to give a special shoutout to Alex Prywes for helping me with the daunting task of analyzing 13F filings. Alex has helped gather and sort through the data of numerous hedge funds (including the one below). Thanks to Alex's help, we can now cover even more funds. And, on that note.... onto the 13F!

The following are Blue Ridge Capital's current holdings as of June 30th 2008, as released in their most recent 13F filing with the SEC. The positions in this most recent 13F were compared to last quarter's 13F and here are the changes made to their portfolio:

New Positions:
Anadarko Petroleum (APC): 2,335,000 shares. This position is 4.29% of Blue Ridge's portfolio.
Visa Inc (V): 1,720,000 shares. 3.43% of Blue Ridge's portfolio.
Vulcan materials: 1,500,000 shares. 2.20% of Blue Ridge's portfolio.
Rowan Cos (RDC): 1,800,000 shares. 2.06% of Blue Ridge's portfolio.
Amazon (AMZN): 940,000 shares. 1.69% of Blue Ridge's portfolio.
Goodrich Petroleum (GDP): 650,000 shares. 1.32% of Blue Ridge's portfolio.
Countrywide Financial: 1,433,000 shares. 0.15% of Blue Ridge's portfolio.
Bare Escentuals (BARE): 281,500 shares. 0.13% of Blue Ridge's portfolio.
Nutrisystem (NTRI): 233,000 shares. 0.08% of Blue Ridge's portfolio.


Added to:
Federal National Mortgage (FNM): Increased position by 1104%. Position is now 2.77% of their portfolio.
Greenlight Capital Re Ltd (GLRE): Increased position by 76.5%. Position is now 0.20% of their portfolio.
Wyeth (WYE): Increased position by 62.86%. Position is now 6.71% of their portfolio.
Apple (AAPL): Increased position by 15.65%. Position is now 5.46% of their portfolio.
Grupo Televisa (TV): Increased position by 11.83%. Position is now 4.46% of their portfolio.
Echostar (SATS): Increased position by 9.97%. Position is now 1.61% of their portfolio.
Google (GOOG): Increased position by 6.09%. Position is now 6.75% of their portfolio.
Broadrige Financial (BR): Increased position by 0.84%. Position is now 3.71% of their portfolio.


Reduced Positions:
American Express (AXP): Reduced position by 23.98%. Position is now 6.05% of their portfolio.
Netflix (NFLX): Reduced position by 28.6%. Position is now 0.93% of their portfolio.
Walmart (WMT): Reduced position by 35.75%. Position is now 2.54% of their portfolio.
First Marblehead (FMD): Reduced position by 36.64%. Position is now 0.05% of their portfolio.
Elong Inc (LONG): Reduced position by 51.82%. Position is now 0.02% of their portfolio.
Grupo Aeroportuario Del Pacifico (PAC): Reduced position by 54.83%. Position is now 1.16% of their portfolio.
Crocs (CROX): Reduced position by 66.06%. Position is now 0.14% of their portfolio.


Removed Positions (Positions Blue Ridge sold out of completely):
America Movil (AMX)
Burlington Northern (BNI)
Coach (COH)
Corus Bankshares (CORS)
Fidelity National Information (FIS)
First American Corp California (FAF)
Formfactor (FORM)
Office Depot (ODP)
SLM Corp (SLM)
Smurfit Stone Container (SSCC)
St Joe Co (JOE)
Starbucks (SBUX)
WebMD Health (WBMD)


Positions with no change:
Covanta (CVA). Position is 5.27% of their portfolio.
Millipore (MIL). Position is 4.49% of their portfolio.
Charles Schwab (SCHW). Position is 4.32% of their portfolio.
Discovery Holding Co (DISCA). Position is 3.89% of their portfolio.
Martin Marietta Materials (MLM). Position is 3.41% of their portfolio.
Target (TGT). Position is 3.11% of their portfolio.
Thermo Fisher Scientific (TMO). Position is 2.90% of their portfolio.
Berkshire Hathaway (BRK.A). Position is 2.49% of their portfolio.
Fomento Economico Mexicano (FMX). Position is 2.31% of their portfolio.
Packaging Corp of America (PKG). Position is 2.18% of their portfolio.
Compton Petroleum Corp (CMZ). Position is 2.08% of their portfolio.
Research in Motion (RIMM). Position is 1.86% of their portfolio.
Eagle Materials (EXP). Position is 1.22% of their portfolio.
Fairfax Financial Holdings (FFH). Position is 1.18% of their portfolio.
American Express (AXP) Calls. Position is 0.64% of their portfolio.
MBIA (MBI). Position is 0.27% of their portfolio.
Federal Home Loan Mortgage (FRE). Position is 0.20% of their portfolio.
Evergreen Energy (EEE). Position is 0.12% of their portfolio.
Gold Reserve Inc (GRZ). Position is 0.10% of their portfolio.
Washington Mutual (WM) Puts. Position is 0.02% of their portfolio.
Perfect World Co (PWRD). Position is 0.01% of their portfolio.
Indymac Bancorp (IDMC). Position is 0.01% of their portfolio.



Top 10 holdings by % of portfolio:
1. Google (GOOG). 6.75% of the portfolio
2. Wyeth (WYE). 6.71% of the portfolio
3. American Express (AXP). 6.05% of the portfolio
4. Apple (AAPL). 5.46% of the portfolio
5. Covanta (CVA). 5.27% of the portfolio
6. Millipore (MIL). 4.49% of the portfolio
7. Grupo Televisa (TV). 4.46% of the portfolio
8. Charles Schwab (SCHW). 4.32% of the portfolio
9. Anadarko Petroleum (APC). 4.29% of the portfolio
10. Discovery Holding Co (DISCA). 3.89% of the portfolio

--------------------------------------

Breakdown: First thing I noticed was Blue Ridge's addition of Anadarko Petroleum (APC). They added it in mass, bringing it up to the fund's 9th largest holding. Although I've seen many hedge funds adding this name over the past 2 quarters, do keep in mind that this filing was as of June 30th, 2008. Since then, natural gas prices, oil prices, and pretty much any stock in those sectors have all plummeted. But, it is worth noting that I have seen this name pop up on 13F filings much more frequently recently. And, Blue Ridge did make quite a hefty purchase. We'll have to wait until next quarter to see whether it was a trade or an investment. In the past, when Griffin has brought a position up to a top 10 holding in one quarter, he has held onto the position. So, time to play the waiting game on that one. Also, he added quite a large new position in Visa (V), bringing it up to 3.43% of the portfolio after not even holding a position last go-round (leaving it just shy of being a top 10 holding).

Next, I noticed he was adding more shares of Wyeth (WYE). This name was already a large fund holding, and he added to his position by 62%, bringing it up to the fund's 2nd largest holding. Recently, there has definitiely been a rotation into any and all stocks relating to healthcare. This is no exception. Also worth noting is Griffin's addition to his already large Apple (AAPL) position. He continues to add to this name and appears to be assembling a solid core position over time.

Even though Griffin made some purchases, he was definitely busier on the selling side of things. And, that makes me even more curious than usual as to what short positions he holds. But, because hedge funds are not required to disclose short positions in their 13F filings (except for Put positions), we are left in the dark on that one. But, anyways, onto the sales. Griffin was selling some consumer names in Netflix (NFLX) and Walmart (WMT). He only sold 20-30% of his positions there so it could just be some profit taking or position size reducing... nothing too major going on. We'll keep an eye on it next quarter and see if he continues to sell those names. Two quarters ago, as I detailed in my Blue Ridge analysis here, we saw that Griffin was starting to sell Coach (COH), Formfactor (FORM), and Smurfit Stone (SSCC). This past quarter, he continued that trend, selling off all the remaining shares in those companies. Additionally, he sold off 66% of his Crocs (CROX) position, which I'm sure was a source of pain for him, given how those shares have plummeted in value over time. Next quarter, it will be interesting to see whether or not he sells off the 'cheap consumer' plays such as Walmart (WMT) and Target (TGT).

Griffin also completely removed America Movil (AMX) from Blue Ridge's portfolio. This is interesting, as this is the 2nd hedge fund so far we've seen completely sell out of this name. (Remember that AMX used to be one of the most common holdings amongst the various hedge funds I track). The stock has been in a downward spiral for numerous months and it appears that numerous hedge funds were the ones responsible for the exodus. In the coming week, we'll see what Griffin's 'Tiger Cub' buddies were up to with their respective AMX positions as well.

Also worth pointing out is that Griffin quickly sold out of Burlington Northern (BNI) completely. In the last 13F filing, we found out he had just added BNI as a new position. And, this time around, we find out that he has quickly sold out. This struck me as somewhat odd, just because practically all hedge funds I track have some sort of exposure to the rails. Maybe Griffin was just locking in some quick profits, or maybe there was something that turned him away from the name. Interesting move, nonetheless. Griffin also had a short stay in Office Depot (ODP). He sold completely out of his position this past quarter, having only added it as a new position in the last 13F filing.

Lastly, I just wanted to point out some of the larger positions that Blue Ridge continues to hold in their portfolio: Millipore (MIL), Covanta (CVA), Grupo Televisa (TV), and Charles Schwab (SCHW). These positions have been top 10 holdings for Blue Ridge for numerous quarters now and are definitely worth a look as they appear to be longer term plays for Griffin.

Blue Ridge Capital's most interesting/peculiar move(s)? Increasing their stake in Fannie Mae (FNM) by over 1100%, bringing it up to 2.77% of the portfolio. (Keep in mind that these positions were as of June 30th, 2008). I only bring this up due to the recent developments in FNM and FRE. Whether it be for a trade or for an investment, John Griffin was definitely up to something here and we can only speculate as to what he's been doing with this position in the past month and a half.

You can view Blue Ridge Capital's most recent 13F as filed with the SEC here.

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Tune in during the rest of the week as I continue to detail the portfolio changes of some well known hedge funds. Funds I'll be looking at the rest of the week: Maverick Capital (Lee Ainslie), Lone Pine Capital (Steven Mandel), and Atticus Capital (Timothy Barakett).