Hedge Fund Performance Numbers: June 2009 Update

We're back again with our monthly aggregation of hedge fund performance numbers and this one is going to be a doozy. Below you will find the June 2009 and year to date performance numbers for many prominent hedge funds along with portfolio composition metrics. Last month, we covered their May performances as well if you're interested. We would like to give a special shoutout to a reader, and then another to a reader in Toronto as well who helped us assemble all of this data. We sincerely appreciate it! Please note that if you are an RSS or Email reader you will need to come to the blog to view the post with all of the performance spreadsheets that are embedded. And with that, let's dive right in:


Hedge Funds in general were up 0.13% in June and are now up 9.41% year to date.

David Einhorn's Greenlight Capital: Greenlight is doing pretty well this year overall. Their Capital LP fund was up 16.3% for the 2nd quarter of '09 and is up 21.5% year to date. Their Capital Qualified LP was up 14.7% for the second quarter and is now up 19.7% for the year. Lastly, their Capital Offshore fund was up 11.9% for the second quarter of 2009 and is now up 17.3% year-to-date. Keep an eye out for a forthcoming post regarding Greenlight's investor letter where we'll examine their moves in detail. In the mean time, you can check out Greenlight's portfolio here.

Bill Ackman's Pershing Square Capital Management: Pershing was up 1.4% for the month of June and is up 11.3% year to date as of that timeframe. In terms of number of positions that are each greater than 0.5% of the portfolio, Pershing has 9 longs and 3 shorts. The vast majority of their longs are Large Cap names, while the same can be said for their shorts. Keep in mind that Pershing also has long CDS exposure (credit default swaps) to the tune of around $900 million. As with Greenlight, we will also be doing a separate post detailing the positions mentioned in their quarterly investor letter. When we covered Pershing's portfolio, we noticed they had a large EMC stake, among other things. Here's their performance sheet:

(click to enlarge)

Jim Simons' Renaissance Technologies: Rentec got back in the swing of things after an abysmal start to the year. For June, their RIEF fund was up 3.93%. Well, maybe they just 'kind of' got back in the swing of things since their RIFF fund was down 5.62% for the month of June. Simons is notoriously private, so we were happy to stumble upon a lengthy interview with the founder of Rentec.

D.E. Shaw & Co (David Shaw): Fellow quant player DE Shaw saw their Oculus fund flat for June and up 2.8% for the year as of the end of June. Their Composite fund on the other hand was up 1.6% for the month while being up 12.5% for the year now. Towards the end of June, we saw DE Shaw file a 13G on Medicis Pharma (MRX).

Balyasny Asset Management (Dmitry Balyasny): They were down 0.19% for June and are slightly up 3.05% year-to-date. We'll be covering their equity portfolio soon in our hedge fund portfolio tracking series so stay tuned. In the mean time, we just covered some of their thoughts on the market recently.

Dan Loeb's Third Point LLC: For the month of June, Loeb's Offshore fund was up 1.8% and is now up 7.2% year to date. Their Partners LP was up 1% for June and is up 5.6% ytd. Their Partners Qualified fund was up 1.4% for June and is up 5.6% for the year. Lastly, their Third Point Ultra fund was up 1.8% for June and is up 8.4% for 2009. We also see some other metrics updated as their Sharpe Ratio since inception is 1.2 while their correlation to the S&P500 since inception is 0.4. Breaking down their exposure by sector, we see that Third Point was net long financials and healthcare. Their largest short position was on the consumer. However, they had an equally large long position leaving them almost net neutral on the consumer. So, we don't see a whole lot of short exposure reflected. If you want to check out their holdings, we just recently covered Third Point's portfolio. Here is their breakdown:

Third Point June Monthly Report



Shumway Capital Partners (Chris Shumway): For the month of June 2009, Shumway was up 0.99% and they are now up 3.97% ytd. As you know, Shumway's portfolio has been replicated as part of our custom MarketFolly portfolio that is seeing 27.9% annualized returns. We created the portfolio with the hedge fund replicator tool Alphaclone, who currently has a free 14-day trial of their full package.


Sprott Asset Management (Eric Sprott): Their Hedge Fund LP has had a bit of a rough year as they were -4.46% for June of 2009 and find themselves down 1.55% for the year. However, they still have impressive historical metrics as they are seeing 22.76% annualized returns with a cumulative return since inception of over 489%. We've started to cover Sprott more on the blog and recently posted up an examination of their Canadian Equity Fund (both longs and shorts). Also, attached below is their hedge fund performance report where you can see the breakdown of all their other hedge funds:

Sprott Hedge Funds June09



Glenrock Global Partners LP: They were down 0.8% for June and are now up 2.8% for 2009. Like Sprott though, Glenrock has impressive historical metrics as they are seeing a compound rate of return of more than 12.5% annually since 2000 without a single down year. They are a long-short equity fund with a focus on bottom-up stockpicking while using macro evaluation. For the first half of the year, their largest winners were short positions in investment banks and another short position in a US medical equipment manufacturer. Additionally, their successful longs included plays in the US semiconductor market, real estate, and software markets. Based by country, they are net short North America (their largest regional short) and net long Japan (their largest regional long). By market cap, they are net short Large Cap and net long Small Cap. By industry, they are net short banks and restaurants/retail while they are net long precious metals, energy, and technology.

Salida Capital: They were up 7.51% for June 2009 and are now up 83.38% for the year. And no, that is not a typo. They were up 3.34% for January, 4.95% for February, 16.01% for March, 7.56% for April, and 26.04% for May. This is quite a strong year for them, but you also have to consider that they were down 66.5% for 2008. So, they are slowly climbing back to where they were before 2008 hit. Still, they have an annualized compounded return of 22.32% which is impressive and they have done so with a Sharpe ratio of 0.61. Currently, the largest percentage of their strategy allocations are in event driven and long/short equity. Sector-wise, they are net long energy and net short 'other.' Their gains in June were largely attributed to energy and gold exposure. Additionally, their position in Addax Petroleum paid off as the company received a cash bid from China's Sinopec. Their stakes in equities and corporate bonds were where the bulk of their gains came from. This Canadian hedge fund firm might also ring a bell because they recently won the auction for lunch with Warren Buffett for the cheap cost of only $1.68 million. And, for a historical snapshot, take a look at some of Salida's macro takeaways that we posted up back in August of 2008. It's interesting to read through them again after a year has almost elapsed since they released them.

Ken Griffin's Citadel Investment Group: Their main Kensington and Wellington funds were up 9.5% in June and are now up 32.19% for 2009. This of course comes after Citadel had a horrible year last year, so they are slowly clawing their way back. Also, back in March, we noted that Citadel would be starting new hedge funds (presumably to garner more fees since their main funds won't be nabbing performance fees anytime soon).

Steven Cohen's SAC Capital: They were up 2.12% for June and are now up 16.35% for the year. This comes after they had a sub-par year in 2008 by their standards.

John Burbank's Passport Capital: Passport had a mixed month as their newer Agriculture fund found success but their Global fund was weak. Their ag fund was up 0.4% for June and is now up 13.6% for 2009 (since inception in March). Their Global Fund, on the other hand, was down 6.4%. However, the fund is still up 24.4% for the year after they had an amazing performance in May. As of right now, they are net short Large Cap stocks, and net long Small Cap & Micro Cap plays. Regionally, they are net short the US and net long India and the Middle East. Sector wise, they are net long basic materials and healthcare while they are net short the consumer and 'other.' Their top 10 public long positions as of the end of June were Riversdale Mining (RIV.AU), Financial Technologies (FTECH.IS), Jordan Phosphate Mines (JPH.JR), Mosaic (MOS), Potash (POT), EFG-Hermes Holding (HRHO.EY), China Lotsynergy (8161 HK), Shuaa Capital (SHUAA.UH), London Mining (LOND.NO), and AK Steel (AKS). This just goes to show how important investor letters and performance breakdowns are to true hedge fund portfolio tracking. While we have looked at their 13F filing in the past, a ton of the positions above are not listed in the 13F filing since those only require the disclosure of US equity positions. As such, their top holdings are very different from what we saw when we looked at their portfolio. This is why only certain funds are good to clone a portfolio from, as you have to look for long/short equity managers that focus primarily on US equities. While Passport's 13F shows Mosiac and Potash as their top positions, they are in reality further down the list in terms of percentage of Passport's overall portfolio. Below you will find Passport's performance breakdown for their Global Fund:

Passport Global Performance Attribution 6.30.09


Paulson & Co (John Paulson): Their Advantage fund was down 1.09% for June but is still up 7.57% for 2009. Paulson recently revealed some portfolio activity which we will be detailing in a separate post, so keep a lookout for that. In the mean time, you can check out Paulson's portfolio here and read up on how Paulson has been buying distressed debt and assembling a large gold portfolio.

Tudor Investment Corp (Paul Tudor Jones): Global macro giant Tudor had a weak June as they were down 1.56% but they are still up 10.76% year-to-date. You can view Tudor's equity positions here.

Louis Bacon's Moore Capital Management: They were -0.4% for June and find themselves up 5.9% for 2009 now. We just recently covered Moore's equity portfolio during global macro week here on Market Folly.

Bruce Kovner's Caxton Associates: Fellow global macro player Caxton also was down for June as they were -0.52% for June and are barely up on the year at 2.21%.



Again, if you are an RSS or Email reader, make sure you come to the blog to view all of the documents we have embedded within this post. Lastly, for a .pdf download of more hedge fund performance numbers, head here. If you want more in regards to recent updates, check out our hedge fund news summary where we round-up all the major activity. And, as always, make sure you check back as we're in the midst of our hedge fund portfolio tracking series where we examine the holdings of some of the top hedge funds out there.

CHP Designation (Certified Hedge Fund Professional): Registration Now Open

Today, the Certified Hedge Fund Professional (CHP) Designation re-opened for registration and we wanted to let you know that all MarketFolly readers get an exclusive $50 discount. In order to receive more information, enter your info at the bottom of this page. The CHP is similar to that of the CFA (Chartered Financial Analyst) or CAIA (Chartered Alternative Investment Analyst), but it is geared specifically towards hedge funds. This is the perfect thing to bolster your background & employment profile if you are looking for a hedge fund job. Additionally, if you're already in the industry, this professional certification can boost your knowledge of the industry and further your credibility. There are only 200 spots available for this round of registration so sign-up fast! During the last registration period, there was a ton of interest generated with our exclusive MarketFolly $50 discount, so take advantage of it before it fills up.

If you want more information regarding the Certified Hedge Fund Professional Designation, we've done some in-depth posts in the past. We interviewed CHP founder Richard Wilson so make sure to check out Part 1 of our interview and Part 2 as well. All MarketFolly readers are eligible for the exclusive $50 discount that we've arranged with the CHP thanks to Richard. By entering your name & email in the form below, it will recognize that you are a MarketFolly reader and the discount will be automatically applied if you go on to register. Filling out this form will not sign you up for the program, but it sets you up to receive information and ensures you will get the discount, so enter your info below!

Enter your contact info below to learn more about the CHP designation:



(Email & RSS Readers: you have to come to the blog to enter your information)

Free 14 Day Trial of Alphaclone

Hey everyone, great news: Mazin the co-founder of Alphaclone has informed me that they are now giving out free 14-day trials to the full membership package. This is something you all cannot pass up as it will give you an inside look at how you can truly replicate a hedge fund portfolio. This free trial to the full membership gives you access to all the hedge fund portfolios, to unlimited clones, unlimited clone groups, and the ability to create custom groups like we did with our custom portfolio that is seeing 27.9% annualized returns!

Those of you who have been wanting to check it out now have a prime opportunity to do so with full access for free. And, for those of you who have gotten the basic membership, you can still get the free trial of the full access to see what you might be missing out on. You can get your free 14 day trial of Alphaclone here.



If you're unfamiliar with Alphaclone, then check out our introduction to this hedge fund portfolio replication tool and also check out our MarketFolly clone.

Soros Fund Management (George Soros) Discloses New Exar (EXAR) Position

In a new 13G filing made with the SEC, George Soros' hedge fund firm Soros Fund Management has disclosed a brand new position in Exar (EXAR). They have a 5.67% ownership stake in the company with 2,465,754 shares and the filing was made due to activity on July 2nd, 2009. This is a brand new position for them because when we last examined Soros' portfolio, they did not hold any shares of EXAR. Soros has been somewhat busy lately, as we also recently detailed their activity in Extreme Networks (EXTR). Additionally, we covered some of Soros' recent thoughts in our hedge fund news summary.

Soros is good to track because of his excellent macro sense and formidable track record as an investor. His thoughts on the current financial landscape are detailed in his latest book, The New Paradigm for Financial Markets: The Credit Crisis of 2008 and What It Means. If you want to get a better sense as to how Soros formulates his investment theses, we highly recommend reading his first book, The Alchemy of Finance. This book is a staple in our recommended reading list and after you read it, you'll understand why

Soros is famous for his stellar returns with partner Jim Rogers when they ran their Quantum fund. (We just covered Jim Rogers' portfolio recently too). Nowadays, he employs his investment style at his own firm. Whether it be equities, bonds, currencies, debt, or commodities, Soros is more of a global macro player, seeking investments in whatever market they can gain an edge.

2008 was an interesting time to be investing, to say the least. Soros detailed his thoughts about his portfolio from 2008 and it makes for a good read. His fund finished 2008 up 8%. His success in 2008 came from making correct bets on the US dollar and betting that short term interest rates in the UK would decline. Interestingly enough, Soros was down for much of the year, until he fought his way back with overtrading. We just recently looked at his portfolio and noted that Soros likes bonds at this stage.

Taken from Google Finance, Exar is "a semiconductor company that designs, sub-contracts manufacturing and sells silicon, software and subsystem solutions for industrial, datacom and storage applications. The Company’s product portfolio includes power management and interface components, datacom products, storage optimization solutions, network security and applied service processors."

Crude Oil - Interview With CME Group's Joseph Ria

The guys over at MarketClub have sat down and interviewed Joseph Ria of the CME Group regarding crude oil and energy. They aimed at putting out some educational and trading material regarding crude oil since it is such a hot topic & commodity these days. Here's a transcript of part of the first interview,

"Crude Oil & Energy Update - Interview with the CME Group's Joseph Ria

When you hear the news reporters talk about the price of
crude oil in the marketplace, they're generally talking about
WTI, which is West Texas Intermediate crude oil. It's a very
light, sweet crude oil and the highest grade that's out there.
Crude oil is based on and priced on the amount of sulfur that's
in the oil. It makes it easier or harder to refine base on the
amount of sulfur. WTI being the lightest and sweetest, is the
highest priced crude oil in the marketplace.

It is a benchmark delivered in Cushing, Oklahoma.

In benchmarks for crude oil and global pricing of crude oil, WTI
probably prices about 50% of the global pricing of crude oil.
Brent being basically the other pricing benchmark. There's two
out there, Brent being a little of a mixture of three different
grades of crude oil; BF&O, Brent 40 and Ossenberg. They're
all produced in the North Sea.

---

That's the first part of the work transcribed and you can view the rest of the stream here. Keep in mind you'll have to do a free sign-up with them to see the material. We like to focus on educational content every once in a while seeing how we have a diverse reader base on the site. And, after all, everyone is a beginner at some point and you can never cease learning. You can check out their video series here.

We also wanted to point out that we have numerous other resources on the topic of crude oil. Some of the most popular articles on Market Folly in the past have been 2 crude oil related pieces by author Tradefast. Firstly, he examined How Contango Affects Crude Oil ETFs. Then, in a follow-up piece, he also examined How to Play Crude Oil via ETFs & ETNs in an article that examines the various crude oil investment vehicles. We highly recommend these pieces as they have received much praise due to their in-depth analytical nature.

Also, for those of you more concerned about where crude oil is heading in the near-term, check out the recent crude oil technical analysis video.

Harbinger Capital Partners Gains Stake in Zap.com (ZPCM)

Philip Falcone's hedge fund Harbinger Capital Partners has made 4 filings of note with the SEC recently that are all related. Firstly, they've filed a 13D on Zap.com Corp (ZPCM) where they now show a 99.5% ownership stake in the company with 49,730,165 shares. The filing was made due to activity on July 9th, 2009. What's interesting about this filing is that Harbinger only directly owns 757,907 shares of ZPCM. However, you'll remember that Harbinger also has a large position in Zapata (ZAP). Well, Zapata holds 97.9% of the outstanding stock of Zap.com (ZPCM) and through their own direct ownership interests in Zapata, Harbinger now also has a large exposure to ZPCM. A little bit confusing with all the similar names and stock symbols, but hopefully everyone follows.

The 757,907 shares Harbinger owns directly were purchased on July 9th, 2009 at share prices between $0.66 and $0.67. In addition to the filings concerning Zap.com, Harbinger has also filed a Form 4 with the SEC which details additional purchases of Zapata (ZAP) shares. On July 9th, 2009, Philip Falcone's firm acquired 3,312,654 shares of ZAP at a price of $7.50. And, as a result, they also amended their 13D filing which shows them now owning 51.6% of ZAP with 9,937,962 aggregate shares owned. This is up ever so slightly from their previous 51.3% stake.

Two main things to take away here: Harbinger now has a lot of exposure to Zap.com (ZPCM) and they also bought a few more shares of Zapata (ZAP). End of story.

Harbinger has been quite busy with filings lately, as we also detailed their new position in Morgans Hotel Group (MHGC) last week. Also, they were selling a ton of Solutia (SOA) shares as well. But, if you want to see all the other positions they hold, you can just check out their portfolio. Last year, Harbinger ranked #1 in the top 10 asset losers, losing 60.8% on a year over year basis as their Offshore fund finished -22.7% for 2008. We then got word that Falcone would be returning to his roots in terms of investing style and would be opening a new fund. As always, we'll continue to monitor the developments regarding their holdings.

Taken from Yahoo Finance, Zap.com "does not have significant operations. The company focuses on searching for assets or businesses that it can acquire so that it can become an operating company and it may also consider developing a new business suitable for its situaiton. Previously, it was engaged in internet operations business."

Crude Oil Chart: Technical Analysis Video

So, what's up with crude oil lately? In the span of a year, this commodity has been all over the map and we've been a bit astonished at what we've witnessed. We saw it ramp way up to $140+ last summer. This summer, where's it headed? Very recently, it's dropped from $70 to $60. The guys at Market Club just put out a great crude oil technical analysis video, so check it out if you want to know if crude will keep dropping.

What We're Reading (7/10/09)

More empirical evidence: buy and hold not dead [Value Plays]

Hedge fund clones grow in appeal [FT] - Too bad they don't have the annualized (out)performance history like our MarketFolly hedge fund clone that is seeing 27.9% annualized returns.

Top 25 largest banks - defaulted loan percentage [The Hard Money Pros]

Recent Hedge Fund News Summary

We're going to try out our hedge fund news summary style post again as readers seemed to like it last time. Except this time around, we'll focus not only on hedge funds but on prominent market strategists and gurus as well. In our previous shotgun hedge fund update, we touched on the latest from George Soros, Och Ziff, Taleb, and a few others. And now here's your daily double shot of hedge fund & market tequila:


Hedge Funds in general saw returns of 9.73% for the year as of around the end of June. This is on track to their best annual start since way back in 1999.

George Soros (Soros Fund Management): Legendary investor and former Quantum Fund manager George Soros was recently out saying that he thinks the US will see a "stop-go" economy for some time. Eventually, he feels fears of inflation will hike interest rates up and as a result, economic growth will suffer. He went on to say that, "The idea of self-correcting markets is a misconception. You cannot prevent bubbles from forming but prevent them from self-reinforcement." Apparently (unbeknownst to us at least), Soros went back into retirement earlier this year after the whirlwind of 2008. If he really is 'retired' again, then we wonder why he is gracing us with his typical dose of (realistic) cynicism. We'll have to find out more in this regard, as this is the first we've heard of it. We have previously covered Soros' holdings in our hedge fund portfolio tracking series.


Bill Gross (PIMCO): 'Mr. Bonds' over at PIMCO is out with his July 2009 outlook and in it he touches on a fact that many seem to have brushed off the market action as their eyes glaze over with 'hope' (whatever that word means). Gross says,

"I was impressed this weekend by an article in the Op-Ed section of The New York Times by staff writer Bob Herbert. “No Recovery in Sight” was the heading and his opening sentence asked, 'How do you put together a consumer economy that works when the consumers are out of work?' That is really all one needs to ask when divining our economy’s future fortune. Unless an optimist can prescribe how to put Humpty Dumpty back together again and shuffle him/her back to work then there can be no return to an 'old normal.' As unemployment approaches 10%, what is less well publicized is that the number of 'underutilized' workers in the U.S. has increased dramatically from 15 to 30 million. Those without jobs, as well as those individuals who only work part-time and have become discouraged and stopped looking, total 30 MILLION people. The number is staggering. Commonsensically, one has to know that many or most of these are untrained for the demands of a green-oriented, goods-producing future economy. Imagine a welding rod in the hands of an investment banker or mortgage broker and you’ll understand the implications quicker than any economist using an econometric model."

He also touched on a phrase we found a bit amusing. Instead of investors typically feasting on asset appreciations and going "Bon Appétit," they are now starving and are going “Non Appétit.” You gotta love silly old Bill with his crazy phrases. We read his outlooks because it makes for good reading, but we kind of gave up on ole Bill a long while ago. Simply put, he thinks that while greed is gone for now, it will certainly be back. You can read his full July outlook here.


Dwight Anderson (Ospraie Funds): This name should ring a bell for Market Folly readers for two reasons. Firstly, because his Ospraie fund blew up and we covered that back in September of 2008. Secondly, you will recall that Anderson was coming back in May and starting two new hedge funds. Well, we're back merely to report that Anderson's new funds went live last month with around $100 million. His new equity fund is focused on companies that are related to commodities and resources while his new commodity fund will invest in the various derivatives related to that asset class. Watch out, the 'bird of prey' is back in the game and they are in-it-to-win-it.


John Meriwether (LTCM, now JWM): Sticking with the hedge fund opening/closure meme, we're happy (?) to report that John Meriwether is shutting down yet another hedge fund. This is really starting to get ridiculous. For those of you unaware, John Meriwether was the founder of Long-Term Capital Management which imploded back in the 1990's and caused a huge ordeal. It was somewhat shocking to see him able to start another fund after such a blowup, but it happened. Yet, we have come full circle again and see that Meriwether's main fund at JWM Partners will be shutting down after it lost 44% between September 2007 and February 2009. Ouch. Oh, and double ouch for the fact that he's shutting down yet another firm. Will this guy ever learn? And, more importantly... will investors ever learn?!


David Rosenberg (Gluskin Sheff & Associates): The notorious market strategist was out with his usual market talk at his new outfit, Gluskin Sheff & Associates. However, he specifically focused on corporate bonds versus equities which intrigued us. He writes, "The comparable yield in the equity market, depending on whether one uses reported or operating P/E multiples on forward or trailing earnings, is little better than 6½%. So corporate debt still trumps stocks. And what this 200 basis point ‘yield gap’ is telling you is that either corporate bond prices will need to rally more down the road or we need to start seeing corporate earnings growth recover sharply enough to pull those multiples down to more attractive levels."

Overall, he thinks that stocks already have a ton of good news priced-in and sees a pullback to 800 on the S&P500. However, he would see that as a buying opportunity and thinks the March lows will hold. The trick here is dealing with an already massive rally in equities from the lows.


Morris Sachs, E.G. Fisher, and Rob Wahl: While these three names might not ring any bells right now, we're here to report that the three gentlemen above will be opening a new hedge fund focused on government bonds named 5:15 Capital Management. The traders have a background at Brevan Howard and RBS Greenwich so they definitely have the credentials. They are starting with around $60 million, with plans to grow it to around $100 million. This hedge fund is intriguing in that its name is derived from a song from the band The Who. The track "5:15" was featured on the album "Quadrophenia" and the founders say they chose the name because they all love the song and band in general.

And, in mocking the hedge fund names typically selected by managers, Sachs said "What are we going to do, try to find another name for the Greek god of money?" Personally, we think someone else out there should create a fund with a name that flat out mocks another hedge fund, to get a little rivalry going. Suggestion: maybe Tontine, due to the irony there. (Confused? See this post).

Fair play to the trio at 5:15 for this random, yet refreshing development. We can't wait to see other new names that pop up now... perhaps 'Enter Sandman Partners'? Or, maybe, in tribute to the king of pop, 'Beat It Capital.' Hmm... we won't hold our breath.


Assan Din: Sticking with the "new-hedge-funds-by-people-you've-probably-never-heard-of" theme, we see that Assan Din is also set to start his own hedge fund after trading for Lehman Brothers. His SaKa Capital will be seeded with $25-50 million and will start trading corporate bonds and derivatives in Singapore in September.


Byron Wien: Just a few days ago, we posted up Pequot Capital strategist Byron Wien's latest commentary. However, this time around he did not deliver his usual dialect regarding the markets. Instead, he took the time to reflect on the closing of the hedge fund firm he was a part of: Pequot Capital. If you haven't read it, we posted up Byron's thoughts here.


Boone Pickens: Although we usually just cover Pickens' hedge fund movements here on Market Folly, this news is still market related in a sense. Remember the "Pickens Plan" and his quest for alternative energy change in the United States? Yea, most people probably don't remember after all this time. To give you a quick refresher, Pickens was seeking the use of various alternatives to replace our dependency on oil and was in the process of building a massive Wind Turbine Farm across Texas.

Well, times are tough because he is suspending plans to build such a farm. While he will still spend $2-3 billion on smaller farms, the grand-daddy plan will have to wait. The delays (per Pickens) were cited to be the drop in natural gas prices and a lack of transmission lines... not to mention the vast slowdown alternative energy companies have seen and the financial turmoil that has affected Pickens as well. After all, when his hedge funds started tanking, he lost a lot of money. So, it looks like we'll have to wait even longer before we see the massive plot of propellers sprawled throughout Texas. This just goes to show how a nice drop in the price of oil (From $140 down to $60) can start to cripple the alternative energy sector. For those interested in Pickens' hedge fund, we recently covered his portfolio here.


Cliff Asness (AQR Capital Management): Yet again, we repeat ourselves: this is starting to get ridiculous. AQR is going to introduce even more "hedge-fund-style mutual funds" starting next month. This is all in a move to continue their expansion into mutual funds in addition to the hedge funds they run. Their AQR Diversified Arbitrage fund launched back in January and this time around they apparently have an arsenal of funds to unleash at the retail investing crowd.

But, then again, this is nothing new as we have seen literally a slew of similar investment vehicles already released. Thus far, we've seen: mutual funds imitating hedge funds, ETFs imitating hedge funds, and even more mutual funds pursuing hedge-like strategies, and then even more ETFs pursuing 'hedgefundesque' strategies. We've covered them all in detail before and we sincerely wonder if this fad will ever cease.

Instead of trying to match hedge fund performances by buying and shorting various index ETFs like those new vehicles do, why not just clone the hedge fund equity portfolios directly like we here at Market Folly have done? After all, with the help of Alphaclone, we've cloned our custom hedge fund portfolio that is seeing 27.9% annualized returns. And no, we're not even joking; check it out.



That wraps up this edition of our hedge fund shotgun round-up, so stay tuned for future updates. In the mean time, check out our previous update, our portfolio tracking series, as well as our most recent profile of Bill Ackman of Pershing Square Capital Management. Also, we would gladly welcome more feedback regarding these 'shotgun' style posts of recent hedge fund news. Hit the comments below or send us an email.

Dan Loeb's Third Point LLC Fancies 'Blank Check' Companies: 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 is Dan Loeb's Third Point LLC, a $2 billion hedge fund firm. Specifically, they deem themselves to be "event driven, value oriented investors." Loeb founded the firm back in 1995 with $3.3 million in seed capital and is still running the show these days. While Third Point is technically an activist fund, Loeb often has numerous passive investments as well. Loeb himself is quite well known for his searing and critical letters to management of various companies. Third Point has seen annual returns averaging over 15% since inception (including the crazy year that was 2008), a Sharpe Ratio of 0.9, and a correlation to the S&P500 of 0.4. As per their April investor update, we saw that they were net long healthcare and utilities, while being heavily net short consumer at that time.

Their Offshore fund was up 7.4% for the month of May 2009. We covered Third Point's performance and more in our May hedge fund performance numbers post. Additionally, you can see some of Third Point's market commentary in their Q1 2009 investor letter. For the month of June 2009, Third Point was up 1.8%, bringing their year to date total to up 7.2%.

In terms of more recent activity, we revealed that Third Point filed an amended 13D on Maguire Properties (MPG). The following were their 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):
Wyeth (WYE), Pfizer (PFE), Schering Plough (SGP-PB) B shares, Amedisys (AMED), Schering Plough (SGP), Life Partners Holdings (LPHI), Legg Mason (LMI).


Some Increased Positions (A few positions they already owned but added shares to)
Nothing of significance


Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
SPDR Gold Trust (GLD): Reduced by 94%
Life-Time Fitness (LTM): Reduced by 79%
Core-Mark Holding (CORE): Reduced by 20%


Removed Positions (Positions they sold out of completely)
Wachovia (WB), Exco Resources (XCO), Potash (POT), Teradata (TDC), SPDR S&P500 (SPY), Telephone Data Systems, UST (UST), Rohm & Haas (ROH), Energy XXI (EXXI), Epicor (EPIC), Dineequity (DIN)


Top 15 Holdings (by % of portfolio)

1. Wyeth (WYE): 22.28% of portfolio
2. PHH Corp (PHH): 13.29% of portfolio
3. Liberty Acquisition Holdings (LIA): 11.75% of portfolio
4. Victory Acquisition Corp (VRY): 5% of portfolio
5. Trian Acquisition (TUX): 4.95% of portfolio
6. Nabi Biopharma (NABI): 4.93% of portfolio
7. Triplecrown Acquisition (TCW): 4.35% of portfolio
8. Pfizer (PFE): 4.31% of portfolio
9. Schering Plough (SGP-PB) B shares : 4.1% of portfolio
10. Sapphire Industrials (FYR): 3.7% of portfolio
11. Depomed (DEPO): 3.22% of portfolio
12. Global Brands Acquisition (GQN): 2.4% of portfolio
13. Greenlight Capital Re (GLRE): 2.22% of portfolio
14. Core-Mark Holding Company (CORE): 1.9% of portfolio
15. Global Consumer Acquisition (GHC): 1.8% of portfolio

Third Point was doing more selling than anything. They completely sold out of Wachovia and Exco, which had previously been 8.7% and 8.2% positions for their hedge fund. Additionally, they sold out of numerous prior 5% positions including Potash, Teradata, and the S&P500 index. Not to mention, they sold practically all of their gold position (GLD). We already knew and reported this back in late April, and it is now reflected in their 13F filing. They were merely using GLD as a trade to shelter their portfolio from uncertainty in the markets. (And head here for a recent technical analysis video on gold).

However, Third Point did still manage to make a few purchases, including shares of Wyeth as they brought it all the way up to their top position at 22.28% of the portfolio as a brand new stake. Undoubtedly, they were playing the merger arbitrage/event driven game here, like so many other hedge funds out there. Additionally, they added new modestly sized positions of Pfizer and Schering Plough.

What still catches our eye though is Third Point's propensity to own merger and acquisition 'blank check' shell companies. Eight of their top fifteen positions are all companies whose sole purpose is to create some sort of event through purchase, merger, capital stock exchange, or asset acquisition. It definitely is quite interesting to see them own so many similar companies in this regard.

Assets from the collective holdings reported to the SEC via 13F filing were $516 million this quarter compared to $799 million last quarter, so quite a noticeable drop off in assets invested on the long side of the portfolio. This is just one of the 40+ prominent funds that we'll be covering in our hedge fund Q1 2009 portfolio series. We've already covered:

- Gurus such as: Soros Fund Management (George Soros), and Jim Rogers.

- 'Tiger Cub' portfolios like: Andreas Halvorsen's Viking Global, Stephen Mandel's Lone Pine Capital, John Griffin's Blue Ridge Capital, Lee Ainslie's Maverick Capital, Shumway Capital Partners (Chris Shumway), Chase Coleman's Tiger Global,

- Outperforming funds like: John Paulson's hedge fund Paulson & Co, Eric Mindich's Eton Park Capital, Raj Rajaratnam's Galleon Group,

- Value and activist funds such as: David Einhorn's Greenlight Capital, Seth Klarman's Baupost Group, Whitney Tison's T2 Partners, Philip Falcone's Harbinger Capital Partners, Ricky Sandler's Eminence Capital, Bill Ackman's Pershing Square Capital Management,

- Concentrated funds that play secular/macro themes such as: Timothy Barakett's Atticus Capital, Bret Barakett's Tremblant Capital Group, Boone Pickens' BP Capital Management, John Burbank's Passport Capital

- Global macro firms such as: Paul Tudor Jones' Tudor Investment Corp, Louis Bacon's Moore Capital Management, Peter Thiel's Clarium Capital,

- And, newer funds on the scene: David Stemerman's Conatus Capital, Anand Parekh's Alyeska Investment Group. Check back each day as we cover new fund portfolios.

Bill Ackman's Pershing Square: Profile & Biography

Continuing our series of hedge fund profiles and biographies, we turn our attention now to Bill Ackman of Pershing Square Capital Management. This is the third biography in our profile series where we've already covered hedge fund legend Julian Robertson of Tiger Management and also Lee Ainslie of Maverick Capital. (We also covered Robertson's big inflation bet as well).

Today is essentially 'Bill Ackman day' here on the blog as we also just covered Pershing's portfolio this morning. So, let's get right into it.

Background

Nowadays, Ackman runs Pershing Square, a well known value/activist based hedge fund that started in 2003. But before Pershing, there was Gotham Partners. He co-founded Gotham with David Berkowitz right out of business school and was forced to shut down around a decade later. They started with only $3 million in seed capital and would eventually garner investments from the who's who of the investment world. Gotham's investors included Michael Steinhardt, Seth Klarman, Leon Levy, Jack Nash, and the Ziffs. They saw 40% annual returns and life was good. At its peak, Gotham had around $500 million in assets.

However, Gotham would then invest in some illiquid assets and found themselves dealing with problems concerning investor redemptions. Ackman and Berkowitz then wound the fund down. Additionally, they would eventually become subject to investigation for possible illegal practices but they were found to have committed no wrongdoing. Ackman went on to form Pershing upon Gotham's dissolution. He started it in 2003 with $54 million in seed capital from only three investors. Nowadays, Pershing manages over $2 billion. Since 2004, Pershing Square has seen a 24% annual return according to Hedge Fund Research (as of 10/14/10).

Ackman received both his degree and his MBA from Harvard. He graduated magna cum laude in 1988 and graduated from Harvard Business School in 1992. Interestingly enough, Ackman is buddies with Whitney Tilson from Harvard. We've tracked Tilson in the past, as he is a fellow hedge fund manager (T2 partners). Portfolio revealed an intriguing story of how Tilson told Ackman to check out the company Farmer Mac on the long side, back when he was still managing Gotham. Ackman liked Farmer Mac as a play, but as a short instead. Thereafter he published a report entitled 'Buying the Farm' where he publicly disclosed his research and the fact that he was short. He was right, and he profited handsomely from its decline.

Investment Strategy/Methodology

Through presentations, investor letters, and just flat out tracking Ackman for a long time, we've gotten a great sense as to how Pershing runs their portfolios. The first (and most obvious) point is that they run a very concentrated portfolio. They like to focus on their best ideas and typically focus on 8 to 12 companies while always on the lookout for other opportunities. They like to say that they only need "a handful of new ideas per year." Their main goal is to generate long-term returns while avoiding permanent loss of capital. But then again, those are pretty typical goals for an asset manager. For their core funds, they try to avoid leverage but are not opposed to using options. And, that is very much the case in their Pershing Square IV fund which invests in Target common stock and options. They like to use options in activist scenarios where their influence can reduce the risk associated to the timing of options and typically use longdated, in the money contracts.

Longs

In terms of what they look for in investments, Pershing focuses on businesses that can generate free cash flow which are also trading at discounts to their intrinsic value. Additionally, they like to see companies with low financial leverage. Their entrance into General Growth Properties (GGWPQ) obviously contradicts this. However, they are playing this more-so for the distressed and event driven side of things as they walk with the company through bankruptcy.

Pershing often also takes activist stakes in the companies they are investing in. Prime example: Target (TGT). Ackman likes to get in there and create value for shareholders so they have more control over the outcome. Unfortunately, things with their Target position have been an uphill battle, to say the least. A great quote from Ackman has arisen from all the Target hoopla. He states, “The investment business is about being confident enough to know that you’re right and everyone else is wrong. Yet you have to be humble enough that you recognize when you’ve made a mistake. Earlier in my career, I think I had the confidence part pretty solid. But the humbleness part I had to learn.’’

Shorts

On the short side of their portfolio, they like to focus on absolute return by examining companies with bad businesses. They look for companies reliant on the markets for liquidity, companies with poor earnings, accounting issues, and other flaws as a red flag and an opportunity to short. One interesting thing to note about their shorts is that they often like to use derivatives to put on their positions as a means to maximize the reward of the play. As Pershing puts it, they look for their shorts to be "situations with asymmetric risk-reward profile, what we call a 'ceiling on valuation' ".

Lastly, we want to also point out that Pershing typically has over 20% of the assets under management (AUM) invested in 'cash' or Treasuries. At the heart of the matter, Pershing is an activist investor that seeks to institute change at various companies to generate value.

Portfolio Movements

The past few years, he has had notable short positions in the bond insurers such as MBIA (MBI) and Ambac (ABK). But, he has since closed those shorts. He also detailed his plans for Target to spin-off its real-estate to unlock value. His Pershing Square IV fund, which invests solely in Target (TGT), has seen poor performance (as Ackman apologized for in one of their investor letters). So far, it has been an uphill battle with Target in regards to instituting change at the company. He recently failed to get his board of directors elected as he staged a large proxy fight against the company. However, Ackman is not giving up on this name and will continue to fight for change at Target. Target is still their largest position due to their Pershing Square IV fund. We examined Pershing's portfolio earlier today as a part of our hedge fund portfolio tracking series.

In terms of other portfolio positions, we saw that they have a large position in EMC (EMC) and in the first quarter of 2009 added new stakes in Yum Brands (YUM) and Apartment Investment & Management (AIV). In terms of positions they sold completey out of, they have recently sold their Dr Pepper Snapple (DPS) shares and their Wendys Arbys (WEN) shares.

In past interviews, Ackman has stated that he is, "long-term bullish on America but not on things turning around in the next few months, or even 12 months. We've had the equivalent of a heart attack, but now we are in recovery, hopefully. It takes time to heal."

Performance

Pershing Square's main fund was up 0.2% for the month of May 2009 and was up 1.2% for the month of June. They are now up 10.5% net year to date for 2009. In terms of positions that are each larger than 0.5% of the portfolio, they have 9 longs and 3 shorts. Additionally, they have around $900 million of notional exposure to credit default swaps. On a relative basis, Pershing escaped 2008 without too much of a dent. Their funds beat the indexes, but still lost money, as they were down around 11-13%, depending on the fund.

Resources

Lastly, we'll finish up with a list of resources we've collected regarding Bill Ackman's Pershing Square:

- Pershing's General Growth (GGWPQ) Presentation @ Ira Sohn Conference

- Bill Ackman's interview with Charlie Rose (4/24/09)

- Bill Ackman talks GGWPQ & TGT


In an interview with Portfolio, Bill Ackman said he was an "extremely resilient person." And, hopefully our biography has given you a bit more background and sense as to why we track his movements here on Market Folly. If you enjoyed this post, then consider getting our free updates via email or you can also get our free updates via RSS reader.

Bill Ackman's Pershing Square Has Large EMC Stake: 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 Pershing Square Capital Management. Bill Ackman runs Pershing Square, a well known value/activist based hedge fund that started in 2003 after Gotham Partners broke up. The past few years, he has had notable short positions in the bond insurers such as MBIA (MBI) and Ambac (ABK). But, he has since closed those shorts.

He also detailed his plans for Target to spin-off its real-estate to unlock value. His Pershing Square IV fund, which invests solely in Target (TGT), has seen abysmal performance, as Ackman apologized for in one of their investor letters. So far, it has been an uphill battle with Target in regards to instituting change at the company. A great quote from Ackman has arisen from all the Target hoopla. He states, “The investment business is about being confident enough to know that you’re right and everyone else is wrong. Yet you have to be humble enough that you recognize when you’ve made a mistake. Earlier in my career, I think I had the confidence part pretty solid. But the humbleness part I had to learn.’’

More recently, Ackman presented at the Ira Sohn Conference where numerous hedge fund managers shared investment ideas. Ackman's gave a presentation on General Growth Properties (GGWPQ) in which he proposed that equity would not be completely wiped out in their bankruptcy. For more reading on the subject, Ackman also separately talked a lot about his Target & General Growth positions.

We track Ackman on the blog extensively and have a lot of resources on him and his fund. Just today, we ran a profile & biography piece on Bill Ackman for a more in depth look. This is part of our biography series in which we've already covered Julian Robertson (of Tiger Management) and Lee Ainslie (of Maverick Capital).

The following were their 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):
Apartment Investment & Management (AIV)
Yum Brands (YUM)


Some Increased Positions (A few positions they already owned but added shares to)
General Growth Properties (GGP): Increased by 16%


Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
Visa (V): Reduced by 69%
Wendys Arbys (WEN): Reduced by 31%
Target (TGT): Reduced by 7%


Removed Positions (Positions they sold out of completely)
Dr Pepper Snapple (DPS)
Sears Holdings (SHLD)


Their Entire Long Portfolio (by % of portfolio)

1. Target (TGT): 42.9% of portfolio
2. EMC (EMC): 33.5% of portfolio
3. Wendys Arbys (WEN): 8.15% of portfolio
4. Visa (V): 6.15% of portfolio
5. Target (TGT) Calls: 3.47% of portfolio
6. Apartment Investment & Management (AIV): 2.23% of portfolio
7. Yum Brands (YUM): 2.14% of portfolio
8. General Growth Properties (GGP): 0.83% of portfolio
9. Borders (BGP): 0.33% of portfolio
10. Greenlight Capital Re (GLRE): 0.2% of portfolio
11. Alexander (ALX): 0.07% of portfolio

Firstly, please note that since this filing there has been activity regarding Pershing's portfolio. In mid May, they sold entirely out of their WEN position. So, the information above does not reflect this (as it is taken directly from their filing that was made prior to the WEN action). Moving on to the rest of their portfolio, we see that Ackman still has his large Target position. This is due to his Pershing Square IV fund that invests solely in TGT via common stock and options. It is undoubtedly their largest position but it is also somewhat of a unique circumstance in our tracking series because its not very often that you come across a firm that has a fund invested solely in one company. However, Pershing still has their main fund which is invested in numerous positions. The rest of Pershing's portfolio is more 'normal' in the sense that it is diversified amongst a few concentrated holdings. One cannot overlook the large EMC stake they have amassed at 33.5% of their portfolio.

While Visa is their fourth largest holding, they still cut it drastically, selling 69% of their position. They also sold completely out of both Dr Pepper Snapple and Sears, with DPS previously being a pretty large position for them as it used to be 7.2% of their portfolio. And, as mentioned before, they also have recently sold out of their Wendys Arbys (WEN) position, even though the data above does not reflect this. In terms of new additions, they added both Apartment Investment & Management (AIV) and Yum Brands (YUM) and both sit right in the middle of their portfolio in regards to position sizing. Overall, not a whole lot of changes on the long side for Pershing Square over the first quarter of 2009.

Assets from the collective holdings reported to the SEC via 13F filing were $1.9 billion this quarter compared to $2.4 billion last quarter, so a drop off of around $500 million or so. This is just one of the 40+ prominent funds that we'll be covering in our hedge fund Q1 2009 portfolio series. We've already covered:

- Gurus such as: Soros Fund Management (George Soros), and Jim Rogers.

- 'Tiger Cub' portfolios like: Andreas Halvorsen's Viking Global, Stephen Mandel's Lone Pine Capital, John Griffin's Blue Ridge Capital, Lee Ainslie's Maverick Capital, Shumway Capital Partners (Chris Shumway), Chase Coleman's Tiger Global,

- Outperforming funds like: John Paulson's hedge fund Paulson & Co, Eric Mindich's Eton Park Capital, Raj Rajaratnam's Galleon Group,

- Value and activist funds such as: David Einhorn's Greenlight Capital, Seth Klarman's Baupost Group, Whitney Tison's T2 Partners, Philip Falcone's Harbinger Capital Partners, Ricky Sandler's Eminence Capital,

- Concentrated funds that play secular/macro themes such as: Timothy Barakett's Atticus Capital, Bret Barakett's Tremblant Capital Group, Boone Pickens' BP Capital Management, John Burbank's Passport Capital

- Global macro firms such as: Paul Tudor Jones' Tudor Investment Corp, Louis Bacon's Moore Capital Management, Peter Thiel's Clarium Capital,

- And, newer funds on the scene: David Stemerman's Conatus Capital, Anand Parekh's Alyeska Investment Group. Check back each day as we cover new fund portfolios.

Sprott Asset Management's Hedge Fund Performance: June 2009

Thanks to another reader we're posting up another bit of interesting info from Sprott Asset Management. Just yesterday, we took at look at Sprott's portfolio of their Canadian Equity Fund. This time around, we're taking a look at their June hedge fund performance data.

Instead of embedding the document in the post below, we're going to try something new here and just point you to a link where you can download the actual .pdf document. To do so, click here. Please let us know if it stops working, because as of right now everything is functional in this regard.

Harbinger Capital Partners: New Position in Morgans Hotel Group (MHGC)

In a 13G filing just filed with the SEC late yesterday, Philip Falcone's hedge fund Harbinger Capital Partners has disclosed an 8% ownership stake in Morgans Hotel Group (MHGC). The filing was made due to activity on June 24th, 2009 and they now own 2,584,726 shares. This is a brand new position for them, as they previously did not hold it when we last looked at Harbinger's portfolio.

In addition to this recent movement, Harbinger has also been selling a lot of shares of Solutia (SOA). It appears that Harbinger is re-tooling and realigning their portfolio and strategy as they also picked up a new position in Zapata (ZAP). Harbinger ranked #1 in the top 10 asset losers, losing 60.8% on a year over year basis as their Offshore fund finished -22.7% for 2008. Also, we got word that Falcone would be returning to his roots in terms of investing style and would be opening a new fund. We'll continue to monitor the developments regarding their holdings.

Taken from Google Finance, Morgans Hotel Group is "an integrated hospitality company that operates, owns, acquires, develops and redevelops boutique hotels primarily in gateway cities and select resort markets in the United States, Europe and in select international locations. As of December 31, 2008, the Company owned or partially owned, and managed a portfolio of 12 luxury hotel properties in New York, Miami, Los Angeles, Scottsdale, San Francisco, London and Las Vegas, comprising approximately 3,700 rooms. In addition, it has two hotel developments, in Boston and New York, and a hotel expansion in Las Vegas representing an estimated 1,300 additional guest rooms."

Hedge Fund Jana Partners Sells More Coleman Cable (CCIX): 13G Filing

In an amended 13G filing with the SEC, Barry Rosenstein's hedge fund Jana Partners LLC has disclosed a 9.7% ownership stake in Coleman Cable (CCIX) with 1,664,729 shares. They have been selling shares of CCIX recently and have filed 2 separate Form 4's with the SEC detailing those sales. Firstly, on June 19th, they sold 72,374 shares with the bulk of the sale coming at $2.90 per share. Then, on June 25th & 26th, Jana sold 515,000 shares at prices pretty much evenly split at $2.83 and then $2.94. Simply put, they've been reducing their position. In their last 13F filing (which shows positions as of March 31st, 2009), Jana held over 2.3 million shares of CCIX. Now, they hold less than 1.7 million.

In addition to their sales of CCIX, we've also noted Jana recently selling shares of Convergys (CVG). Additionally, they've also filed a 13D on Immucor (BLUD). This all comes after Barry Rosenstein's hedge fund had a rough 2008 and apparently received redemption requests for a significant amount of their capital (20-30%). They were forced to set aside illiquid positions in an attempt to meet all the requests. It appears as though they've survived but we'll still monitor any further transactions.. We'll also be checking in on the rest of their portfolio in our hedge fund portfolio tracking series after skipping them last go-round due to the uncertainty swirling around the fund.

Jana was founded in 2001 by Barry Rosenstein and typically employs activist, market neutral, and long/short equity strategies in public equity markets. Rosenstein received his BS from Lehigh University and his MBA from the Wharton School of Business at the University of Pennsylvania. Jana has returned 20.9% each year annualized from 2001 til 2007. Rosenstein sees Jana's future in a strategy that uses management adjustments to force change at companies, which in turn can send shares higher. And, hopefully that strategy changes things for the better, as 2008 was a rough year for them.

Taken from Google Finance, Coleman Cable is "a designer, developer, manufacturer and supplier of electrical wire and cable products for consumer, commercial and industrial applications, with operations primarily in the United States, and to a lesser degree, in Canada. It produces products across four primary product lines: industrial wire and cable, including portable cord, machine tool wiring and other power cord products."

Technical Analysis & Charts: Stock Trading Ideas (Weekly Watchlist 7/7/09)

Here is the latest weekly watchlist courtesy of the OptionAddict. As always, a great video look at some technical setups on the charts for those of you looking for trading opportunities.



If you're new to technical analysis or you want to learn more, then check out our technical analysis recommending reading list. And, if you missed them last week, we also posted up a video on how to find trades, as well as a quick look at the charts of both AAPL and RIMM.

Pequot Capital: Byron Wien's July 2009 Commentary

At first, we thought it was a bit odd that we were reading commentary coming from Pequot Capital, seeing as they are liquidating their core fund (And, not to mention, we just revealed some of the positions they were unwinding). Donno, just seems weird to us, even if they are shutting down mainly due to poor image and marketing problems, more-so than poor performance (after all, AUM is king in hedgefundland). Just seems like we're reading something from the grave, even though 2 of their funds will still remain open. In the past, we've covered some of Byron's previous commentary too.

Take note that this particular piece deals more with the state of affairs regarding Pequot and does not really deal with market commentary like Byron's typical work. Unique circumstances, obviously. RSS & Email readers may need to come to the blog to view it. Attached below is the July 2009 commentary from Pequot's strategist Byron Wien:

Sprott Asset Management's Portfolio: Canadian Equity Fund (Longs & Shorts)

Since many of our readers desire more coverage of Canadian based Sprott Asset Management, we thought we would post up this nice tidbit that a reader sent to us. We have been slacking in our coverage of this talented firm and we apologize. There's just too many funds out there to cover these days! If anyone wants to be our "go-to" Sprott info guy (or gal) please get in contact with us as we are very interested in tracking their movements. For those of you unfamiliar with Sprott, they were recently ranked 49th in Barron's top 100 hedge fund rankings for 2009.

At any rate, attached below is Sprott's Canadian Equity Fund quarterly portfolio disclosure. This shows their positions as of March 31st, 2009 (exactly like all of the hedge funds we track in our portfolio tracking series). However, this form is a bit different in that it reveals their short positions as well in the interest of full transparency. Keep in mind that this specific portfolio is from that of a mutual fund, not a hedge fund. Nevertheless, we feel there is still information to be gleaned from them.

As we look at the broad overview, we see that they have 42.9% of their net asset value invested in gold and silver bullion on the long side of the portfolio. This simply cannot be overlooked. Additionally, they have another 22.2% in mining and precious metals plays. On the short side of the portfolio, their largest allocation there is in financials, as they are (13.5%) allocated to financial short positions. Their total long positions are 83.4% of their net asset value and their shorts are (16.8%) of their NAV. Then, on top of all that, they still have 33.5% of their NAV in cash and short-term investments. This is another feature of their portfolio one must pay attention to. Typically, cautious managers will keep up to 20% of assets in cash. Sprott is up to 33.5%. Not to mention, their large weighting in 'uncertainty plays' like gold and precious metals further reiterates their cautious stance.

After their cash, gold bullion, and silver bullion positions, First Uranium Corporation is their largest equity position at 2.7% of NAV. Shifting to the short side of their portfolio, Toronto-Dominion Bank is their largest short at (4.2%) of NAV, followed by Canadian Imperial Bank of Commerce at (3.1%). Obviously, take this information with a grain of salt as it is all delayed and positions were reported as of March 31st, so there is definitely a big time lapse factor here. At the same time, it's hard not to notice their very cautious stance with large amounts of cash and precious metals on hand.

Here is the full embedded document:





For those of you wanting some more reading material from Sprott, we'd suggest checking out an older special report from them that was an excellent read.