Shumway Capital Partners (Chris Shumway) 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 is Shumway Capital Partners run by Chris Shumway. Shumway started his own fund after leaving well-known Julian Robertson's Tiger Management. And thus, as a progeny of Robertson, he is a part of what people call the 'Tiger Cubs' (people who have started their own firms after succeeding at Tiger). We've already covered many of the 'Tiger Cub' funds including Stephen Mandel's Lone Pine Capital, Andreas Halvorsen's Viking Global, Lee Ainslie's Maverick Capital, and John Griffin's Blue Ridge Capital.

Taken from our post on 'Tiger Cub' biographies, "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)." As noted in our latest hedge fund performances, Shumway's Ocean Fund was up 2.54% for February and 5.75% for the year as of then. At a 'Tiger Cub' hedge fund manager panel, Shumway suggested that buying stocks that were down largely due to hedge fund liquidations would be a winning strategy longer-term. Lastly, in terms of recent activity, Shumway has filed a 13G on Equinix (EQIX).

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):
EMC (EMC)
Savvis (SVVS) Bonds
SBA Communication (SBAC) Bonds
NII Holdings (NIHD) Bonds
Celanese (CE)
Equinix (EQIX) Bonds
Stryker (SYK)
Thermo Fisher Scientific (TMO)
Union Pacific (UNP)
Equinix (EQIX)
American Tower (AMT)
Biogen Idec (BIIB)
Visa (V)
St Jude (STJ)


Some Increased Positions (A few positions they already owned but added shares to)
News Corp (NWS-A): Increased by 153%


Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
NII Holdings (NIHD): Reduced position by 97.9%
Cisco Systems (CSCO): Reduced position by 96.7%
SBA Communications (SBAC): Reduced position by 96.5%
Potash (POT): Reduced position by 96.4%
Qualcomm (QCOM): Reduced position by 80%
CVS Caremark (CVS): Reduced position by 78%
Teva Pharma (TEVA): Reduced position by 57%
Mastercard (MA): Reduced position by 27%
Waters (WAT): Reduced position by 11%


Removed Positions (Positions they sold out of completely)
Mercadolibre (MELI)
Chipotle (CMG-B)
Sirius Satellite Notes
Google (GOOG)
Wyeth (WYE)
Focus Media (FMCN)
Medoc Health (MHS)
Annaly Capital Management (NLY)
Zimmer Holdings (ZMH)
Apple (AAPL)


Top 20 Holdings (by % of portfolio)

1. Qualcomm (QCOM) Calls: 15.6% of portfolio
2. St Jude Medical (STJ): 11.5% of portfolio
3. Mastercard (MA): 11.3% of portfolio
4. Visa (V): 9.6% of portfolio
5. Biogen Idec (BIIB): 9.6% of portfolio
6. American Tower (AMT): 7% of portfolio
7. Waters (WAT): 6.7% of portfolio
8. Equinix (EQIX): 5% of portfolio
9. Teva Pharma (TEVA): 3.8% of portfolio
10. News Corp (NWS-A): 3.37% of portfolio
11. Union Pacific (UNP): 3.1% of portfolio
12. CVS Caremark (CVS): 2.5% of portfolio
13. Qualcomm (QCOM): 2.4% of portfolio
14. Thermo Fisher Scientific (TMO): 2.3% of portfolio
15. Stryker (SYK): 1.7% of portfolio
16. Hansen Natural (HANS): 0.7% of portfolio
17. NII Holdings (NIHD) Bonds: 0.5% of portfolio
18. Equinix (EQIX) Bonds: 0.4% of portfolio
19. Celanese (CE): 0.36% of portfolio
20. NII Holdings (NIHD) 2nd set of Bonds: 0.34% of portfolio

Shumway joins numerous other prominent hedge funds (and in particular Tiger Cubs) with Visa (V) as a top holding. They also sizably increased their position in News Corp (NWS-A) and brought their new stake in Union Pacific up to a top holding. Assets from the collective long US equity, options, and note holdings were $2.1 billion last quarter and were $1 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:

• Well known gurus such as: Carl Icahn, Warren Buffett, & George Soros
• 'Tiger Cub' portfolios: Stephen Mandel's Lone Pine Capital, Andreas Halvorsen's Viking Global, Lee Ainslie's Maverick Capital, and John Griffin's Blue Ridge Capital
• Global macro giants: Bruce Kovner's Caxton Associates, Louis Bacon's Moore Capital Management, Peter Thiel's Clarium Capital, & Paul Tudor Jones' Tudor Investment Corp
  
• Value & Activist players like: Bill Ackman's Pershing Square, Seth Klarman's Baupost Group, Art Samberg's Pequot Capital, & David Einhorn's Greenlight Capital
• Concentrated portfolios like: Bret Barakett's Tremblant Capital, & Timothy Barakett's Atticus Capital
• Some solid names: Paulson & Co (John Paulson) and Eric Mindich's Eton Park Capital
• Newer funds on the scene: James Pallotta's Raptor Capital Management, Anand Parekh's Alyeska Investment Group, & David Stemerman's Conatus Capital
• Troubled funds: Jeffrey Gendell's Tontine Associates
  

Check back daily as we'll cover a new fund each day.

Hedge Fund Shumway Capital Files 13G on Equinix (EQIX)

In a 13G filing with the SEC, hedge fund Shumway Capital Partners has disclosed a 5.39% stake in Equinix (EQIX) with aggregate amount beneficially owned of 2,037,527 due to activity on February 26th, 2009. This is a newer position for them, as they've previously did not own it as of their November portfolio update disclosed in a SEC 13F filing.

Shumway Capital Partners is run by Chris Shumway. Shumway started his own fund after leaving well-known Julian Robertson's Tiger Management. And thus, as a progeny of Robertson, he is a part of what people call the 'Tiger Cubs' (people who have started their own firms after succeeding at Tiger). We've already covered many of the 'Tiger Cub' funds including Stephen Mandel's Lone Pine Capital, Lee Ainslie's Maverick Capital, John Griffin's Blue Ridge Capital, and Andreas Halvorsen's Viking Global. Taken from our post on 'Tiger Cub' biographies, "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)." Lastly, at a 'Tiger Cub' hedge fund manager panel, Shumway suggested that buying stocks that were down largely due to hedge fund liquidations would be a winning strategy longer-term.

Taken from Google Finance,

Equinix "provides network-neutral colocation, interconnection and managed information technology (IT) infrastructure services to enterprises, content providers and financial companies."

Shumway Capital Partners (Chris Shumway): Hedge Fund Tracking 13F Filing - Q3 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've already covered:

• Timothy Barakett's Atticus Capital
• Whitney Tilson's T2 Partners
• Peter Thiel's Clarium Capital
• Bill Ackman's Pershing Square
• Bret Barakett's Tremblant Capital
• John Paulson's Paulson & Co
• David Einhorn's Greenlight Capital
• Dan Loeb's Third Point
• Paul Tudor Jones' Tudor Investment Corp
• Louis Bacon's Moore Capital Management
• Bruce Kovner's Caxton Associates
• George Soros Soros Fund Management
  

Next up is Shumway Capital Partners run by Chris Shumway. Shumway started his own fund after leaving well-known Julian Robertson's Tiger Management. And thus, as a progeny of Robertson, he is a part of what people call the 'Tiger Cubs' (people who have started their own firms after succeeding at Tiger). We've already covered many of the 'Tiger Cub' funds including Stephen Mandel's Lone Pine Capital, Lee Ainslie's Maverick Capital, John Griffin's Blue Ridge Capital, and Andreas Halvorsen's Viking Global. Taken from our post on 'Tiger Cub' biographies, "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)." Shumway's Ocean Fund was up 0.85% for the month of October but was -8.24% for the year at that time, as we noted in our October hedge fund performance update (see also our recent November update). Lastly, at a recent 'Tiger Cub' hedge fund manager panel, Shumway suggested that buying stocks that were down largely due to hedge fund liquidations would be a winning strategy longer-term.

The following were Shumway's long equity, note, and options holdings as of September 30th, 2008 as filed with the SEC. All holdings are common stock unless otherwise denoted.


Some New Positions (Brand new positions that they initiated in the last quarter):
CVS Caremark (CVS)
Medco Health (MHS)
Focus Media (FMCN)
Wyeth (WYE)
News Corp (NWS-A)
Hansen Natural (HANS)
Mercadolibre (MELI)


Some Increased Positions (A few positions they already owned but added shares to)
SBA Comm (SBAC): Increased position by 20%
Qualcomm (QCOM) Calls: Increased position by 1.6%


Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
Cisco Systems (CSCO): Reduced position by 86%
Google (GOOG): Reduced position by 84%
Teva Pharma (TEVA): Reduced position by 74.5%
Qualcomm (QCOM): Reduced position by 72%
Potash (POT): Reduced position by 68%
Chipotle (CMG-B) B Shares: Reduced position by 55%
Waters (WAT): Reduced position by 49%
Sirius Satellite (SIRI) Notes: Reduced position by 37%
Mastercard (MA): Reduced position by 35%
Zimmer Holdings (ZMH): Reduced position by 34%
NII Holdings (NIHD): Reduced position by 29%


Removed Positions (Positions they sold out of completely)
Union Pacific (UNP)
XTO Energy (XTO)
Burlington Northern (BNI)
Apple (AAPL)
St Jude (STJ)
Research in Motion (RIMM)
American Tower (AMT)
Visa (V)
Crown Castle (CCI)
Colgate Palmolive (CL)
Occidental Petroleum (OXY)
EMC Corp (EMC)
Baidu (BIDU)
Monsanto (MON)
SLM (SLM)
Chipotle (CMG)
Staples (SPLS)
Mosaic (MOS)
Liberty Global (LBTYK) Series C Common
Liberty Global (LBTYA)


Top 20 Holdings (by % of portfolio)

1. Qualcomm (QCOM) Calls: 11.9% of portfolio
2. Mastercard (MA): 11.8% of portfolio
3. NII Holdings (NIHD): 9.4% of portfolio
4. Qualcomm (QCOM): 8.8% of portfolio
5. SBA Comm (SBAC): 8.6% of portfolio
6. CVS Caremark (CVS): 8.3% of portfolio
7. Waters (WAT): 7.3% of portfolio
8. Teva Pharma (TEVA): 5.9% of portfolio
9. Zimmer Holdings (ZMH): 5.6% of portfolio
10. Medco Health (MHS): 4.1% of portfolio
11. Potash (POT): 3.8% of portfolio
12. Cisco Systems (CSCO): 3.2% of portfolio
13. Focus Media (FMCN): 2.2% of portfolio
14. Wyeth (WYE): 2% of portfolio
15. Google (GOOG): 1.6% of portfolio
16. Sirius (SIRI) Notes: 1.4% of portfolio
17. News Corp (NWS-A): 1.1% of portfolio
18. Chipotle (CMG-B) B shares: 1.1% of portfolio
19. Sirius (SIRI) Notes2: 1.1% of portfolio
20. Hansen Natural (HANS): 0.4% of portfolio

Assets from the collective holdings were $7.88 billion last quarter and were $1.78 billion this quarter. As you can easily tell from the raw figures, Shumway was making a large move out of equity markets over the last quarter. And, they were largely scaling out of natural resource and commodity related names that have seen extreme selling pressure the past few months. Please note that we have not detailed every single change to every single position in this update, but we have covered all the major moves. Also, keep in mind that these filings only include long equity, notes, and options holdings and do not reflect their cash, short portions, or holdings in other markets (currency, commodities, debt, etc). This is just one of many funds in 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, Timothy Barakett's Atticus Capital, John Griffin's Blue Ridge Capital, Bret Barakett's Tremblant Capital, Andreas Halvorsen's Viking Global, John Paulson's Paulson & Co, David Einhorn's Greenlight Capital, and Dan Loeb's Third Point, Paul Tudor Jones' Tudor Investment Corp, Louis Bacon's Moore Capital Management, Bruce Kovner's Caxton Associates, and Soros Fund Management (George Soros). Overall, its been one of the worst years ever for hedge funds, as we noted in our new November 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 Shumway:
- 'Tiger Cub' biographies
- Hedge fund manager panel (Tiger Cubs)
- November hedge fund performance numbers
- Julian Robertson's recent buys
- October hedge fund performance numbers
- Hedge Fund Rankings

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.