Top Funds' Activity in Q3 2017
The stock moves that the biggest hedge fund managers made in the third quarter are being revealed today.Before I get to what top funds bought and sold last quarter, I must tell you, I'm very busy in the mornings focusing all my attention on my watch list and certain stocks (click on image):
Hedge funds of a certain minimum size are required to disclose their long stock holdings in filings to the SEC known as 13-Fs. Of course, the filings only provide a partial picture since they do not show short positions or wagers on commodities and currencies. What’s more is these filings come out 45 days after the end of each quarter, so it’s possible they could have traded in and out of the positions.
Still, it does provide a partial look into where some of the top money managers have been placing money in the stock market.
The stock moves that the biggest hedge fund managers made in the third quarter are being revealed today.
Appaloosa Management (David Tepper)
New: Micron Technology (MU)
Boosted: Facebook (FB)
Trimmed: Allergan (AGN)
Exited: Wells Fargo (WFC)
Baupost Group (Seth Klarman)
New: McKesson (MCK), AMC Entertainment (AMC)
Boosted: Allergan, Cardinal Health (CAH), Antero Resources (AR)
Trimmed: Dell Technologies (DVMT), Avis Budget (CAR)
Exited: Qualcomm (QCOM)
Bridgewater Associates (Ray Dalio)
Boosted: SPDR Gold Shares (GLD), Vanguard FTSE Emerging Markets ETF (VWO)
Trimmed: SPDR S&P 500 ETF (SPY), Intel (INTC)
Coatue Management (Philippe Laffont)
New: Tableau Software (DATA)
Boosted: Apple (AAPL), Alibaba (BABA), Shopify (SHOP), Snap Inc. (SNAP)
Trimmed: Symantec (SYMC)
Exited: Disney (DIS), eBay (EBAY)
Duquesne Capital (Stanley Druckenmiller)
New: Citigroup (C), Netflix (NFLX), and Nvidia (NVDA)
Boosted: JD.com, Salesforce (CRM), WorkDay (WDAY), Alphabet
Exited: Delta (DAL), American Airlines (AAL)
JANA Partners (Barry Rosenstein)
New: Jack In The Box (JACK)
Exited: Hewlett-Packard (HPE)
Marcato Capital (Mick McGuire)
New: Itron (ITRI)
Boosted: Terex Corporation (TEX)
Trimmed: IAC/ InteractiveCorp (IAC), Sotheby’s (BID)
Omega Advisors (Leon Cooperman)
New: Aetna (AET), Expedia (EXPE)
Boosted: AMC Networks (AMCX)
Exited: Allergan
Passport Capital (John Burbank)
New: Tahoe Resources (TAHO)
Boosted: Alibaba, Altaba, Amazon (AMZN)
Trimmed: Advanced Micro Devices (AMD)
Exited: Facebook
Third Point LLC (Daniel Loeb)
New: Altaba (AABA), Shire (SHPG)
Boosted: Alibaba (BABA)
Trimmed: Alphabet (GOOGL)
Exited: Humana (HUM), Charter Communications (CHTR)
Tiger Global (Chase Coleman)
New: Despegar.com Corp (DESP), RedFin (RDFN)
Boosted: Netflix (NFLX), Facebook (FB)
Trimmed: Teladoc (TDOC)
Exited: Alphabet (GOOG, GOOGL), American Tower (AMT)
Tiger Management (Julian Robertson)
New: Anthem (ANTM), JD.com (JD)
Boosted: Facebook, JPMorgan (JPM)
Trimmed: Celgene (CELG)
Exited: Teva (TEVA), Priceline (PCLN), Nike (NKE)
"Leo, we don't care about your watch list which moves up and down like a yo-yo, we want to know what Soros and company bought and sold last quarter."
Well, let me be frank with you, I don't care what Soros and company bought and sold last quarter and because you're not paying me enough to do this blog, I have to focus my attention on making money day in, day out.
More importantly, these are not markets to take big risks. Period. You can trade in and out of positions but you need to be really good and even then, you can get killed.
I try to post some of my thoughts on Stocktwits but there's no time, and when I'm trading and concentrating, I need all my attention because things move fast.
For example, one of the stocks on my watch list, Calithera Biosciences (CALA), took a nosedive this week and hit a low of $8.80 a share at around 3:20 yesterday before coming back strong this morning (click on image):
Why is this biotech on my watch list? Because a big hedge fund I like, Viking Global, owns a big stake in it and it has been on my watch list ever since it initiated a position.
Moreover, another big hedge fund I track closely, Adage Capital, also has a big position in this biotech. So, this morning, I watched it like a hawk, waited for biotechs (XBI) to rebound and then almost hit the trigger.
“Almost hit the trigger? What kind of a trader are you?!? That was an easy 8% right there!! Get out of US long bonds (TLT) and pull the trigger!!! Stevie Cohen would have fired you if he saw you not taking enough risk!!”
Well, I don’t answer to Stevie Cohen or anyone else, only to the man in the mirror and right now, I don't like these markets at all and even wrote on Stocktwits that we need to see a significant pullback in the S&P 500 right back to its 200-week moving average and lower (click on image)
"But that chart is so bullish, so beautiful, the trend is your friend, just buy MOAR STAWKS!"
Hold your horses Kimosabe, I've traded long enough and have gotten my head handed to me (literally) on a few occasions to know when to dial up risk and when to dial it down.
For example, right before the US elections, I told you to LOAD UP on biotechs (XBI) stating it was America's biotech, not Brexit moment.
Of course, back then, all my buddies were laughing at me, thinking I was nuts but they stopped laughing after they saw biotechs explode up. I can't blame them, most people would never trade the way I trade, nor do I recommend it because it's way too risky and volatile.
But the thing I keep emphasizing is to understand the macro environment first and foremost, then trade around it.
A couple of days ago when I discussed why CalPERS is considering more than doubling its bond allocation, I stated this:
[...] you know my market views. I'm openly worried about deflation hitting the US and my most recent market comments tell you that I think it's wise to take some risk off the table:
I forgot to mention you need to be extra vigilant navigating through these prickly markets or else that big cactus will come back to haunt you for a long, long time.Moreover, I don't foresee a big reversal in inflation, and openly worry many market participants still don't get the "baffling" mystery of inflation-deflation.
- The Canary in the Coal Mine? (beware of junk bonds)
- Signs of Euphoria Creeping into Markets? (no thanks to global central banks)
- As Good As it Gets? (for stocks and other risk assets)
- Markets on Edge of a Cliff? (literally but we won't know until well after storm)
I have also repeatedly stated on my blog to load up on US long bonds (TLT) on any backup in yields because when the bubble economy bursts and the next deflation tsunami and financial crisis hit us, it will bring about the worst bear market ever.
Of course, central banks know all this which is why the Fed has signaled it's preparing for QE infinity, something which I fundamentally believe is a foregone conclusion, which can explain pockets of speculative activity in the stock market.
I've said it before but it's worth mentioning again, my top three macro conviction trades going forward:
- Load up on US long bonds (TLT) while you still can before deflation strikes the US. This remains my top macro trade on a risk-adjusted basis.
- A few months ago I said it's time to start nibbling on the US dollar (UUP) and it continued to decline but I think the worst is behind us, and if a crisis strikes, everyone will want US assets, especially Treasuries. I'm particularly bearish on the Canadian dollar (FXC) and would use its appreciation this year to load up on US long bonds (TLT).
- My third macro conviction trade is to underweight/ short oil (USO), energy (XLE) and metals and mining (XME) as the global economy slows. Sell commodity indexes and currencies too. I'm also short emerging market stocks (EEM) and bonds (EMB).
Now, what are the top funds doing? Are there any interesting moves worth noting? Sure, I noticed that Julian Robertson cut his big losses in Teva Pharmaceuticals (TEVA) last quarter but David Abrams, the one-man wealth machine, initiated a new position last quarter right before the stock got slammed hard a few weeks ago (click on image):
Now, Teva's shares are up nicely today but I can tell you from experience, that's typically not a chart you want to buy, more often than not, you will be disappointed (it is oversold but can become even more oversold).
And while David Abrams and his mentor Seth Klarman are great value investors, when it comes to timing, they're far from perfect. They have both been sitting on shares of Keryx Biopharmaceuticals (KERX) for a long time and they're losing money on them so far.
Still, these guys have conviction, they're excellent value investors who don't typically churn their portfolio, so if they're accumulating a position, it's worth paying attention and maybe even buying.
[Update: Citadel's Ken Griffin also took positions in volatile Teva and Valeant pharmaceuticals, however, George Soros is shorting both these companies via put options.]
As you click on the links below to each fund, you will be taken directly to their top holdings. I want you to stop looking at this information in a vacuum. Think about the macro environment and risks in these markets first.
Then, have fun looking at their top holdings, where they increased, where they reduced, start educating yourselves on how to draw daily and weekly charts for free on StockCharts using very simple moving averages at first (50, 100, 200 day or week) and start thinking whether there are risks worth taking on the long and short side.
"Leo, I want to learn to trade like you, can you teach me and give me a list of all the stocks you track and share more of your wisdom?".
No, I can't, it's too cumbersome and your risk tolerance definitely won't match mine. I also share way too much here and on Stocktwits.
All I can tell you is analyzing and trading markets and stocks is a passion of mine. I regularly look at the YTD performance of stocks, the 12-month leaders, the 52-week highs and 52-week lows. I also like to track the most shorted stocks and highest yielding stocks in various exchanges and I have a list of stocks I track in over 100 industries/ themes to see what is moving in real time.
When I tell you these aren't the markets you want to be playing in, I know exactly what I'm talking about because I'm watching these markets closely every day and my deflationary macro call looms large and is weighing on on all risk assets, not just stocks.
These ARE NOT the markets you want to be making any bullish or contrarian bets on. Trust me when I tell you global deflation will obliterate all risk assets and the only refuge will be in US long bonds (TLT).
Still, if you want to find hidden gems and take some risks, have fun looking at the third quarter activity of top funds listed below (click on links and then click on the fourth column head, % chg, to see where they descreased and increased their holdings).
Top multi-strategy and event driven hedge funds
As the name implies, these hedge funds invest across a wide variety of hedge fund strategies like L/S Equity, L/S credit, global macro, convertible arbitrage, risk arbitrage, volatility arbitrage, merger arbitrage, distressed debt and statistical pair trading.
Unlike fund of hedge funds, the fees are lower because there is a single manager managing the portfolio, allocating across various alpha strategies as opportunities arise. Below are links to the holdings of some top multi-strategy hedge funds I track closely:
1) Citadel Advisors
2) Balyasny Asset Management
3) Farallon Capital Management
4) Peak6 Investments
5) Kingdon Capital Management
6) Millennium Management
7) Eton Park Capital Management
8) HBK Investments
9) Highbridge Capital Management
10) Highland Capital Management
11) Pentwater Capital Management
12) Och-Ziff Capital Management
13) Pine River Capital Capital Management
14) Carlson Capital Management
15) Magnetar Capital
16) Mount Kellett Capital Management
17) Whitebox Advisors
18) QVT Financial
19) Paloma Partners
20) Weiss Multi-Strategy Advisors
21) York Capital Management
Top Global Macro Hedge Funds and Family Offices
These hedge funds gained notoriety because of George Soros, arguably the best and most famous hedge fund manager. Global macros typically invest across fixed income, currency, commodity and equity markets.
George Soros, Carl Icahn, Stanley Druckenmiller, Julian Robertson and now Steve Cohen have converted their hedge funds into family offices to manage their own money and basically only answer to themselves (that is my definition of true investment success).
1) Soros Fund Management
2) Icahn Associates
3) Duquesne Family Office (Stanley Druckenmiller)
4) Bridgewater Associates
5) Pointstate Capital Partners
6) Caxton Associates (Bruce Kovner)
7) Tudor Investment Corporation
8) Tiger Management (Julian Robertson)
9) Moore Capital Management
10) Point72 Asset Management (Steve Cohen)
11) Bill and Melinda Gates Foundation Trust (Michael Larson, the man behind Gates)
12) Joho Capital (Robert Karr, a super succesful Tiger Cub who shut his fund in 2014)
Top Market Neutral, Quant and CTA Hedge Funds
These funds use sophisticated mathematical algorithms to make their returns, typically using high-frequency models so they churn their portfolios often. A few of them have outstanding long-term track records and many believe quants are taking over the world. They typically only hire PhDs in mathematics, physics and computer science to develop their algorithms. Market neutral funds will engage in pair trading to remove market beta.
1) Alyeska Investment Group
2) Renaissance Technologies
3) DE Shaw & Co.
4) Two Sigma Investments
5) Numeric Investors
6) Analytic Investors
7) Winton Capital Management
8) Graham Capital Management
9) SABA Capital Management
10) Quantitative Investment Management
11) Oxford Asset Management
12) PDT Partners
13) Princeton Alpha Management
Top Deep Value, Activist, Event Driven and Distressed Debt Funds
These are among the top long-only funds that everyone tracks. They include funds run by legendary investors like Warren Buffet, Seth Klarman, Ron Baron and Ken Fisher. Activist investors like to make investments in companies where management lacks the proper incentives to maximize shareholder value. They differ from traditional L/S hedge funds by having a more concentrated portfolio. Distressed debt funds typically invest in debt of a company but sometimes take equity positions.
1) Abrams Capital Management (the one-man wealth machine)
2) Berkshire Hathaway
3) Baron Partners Fund (click here to view other Baron funds)
4) BHR Capital
5) Fisher Asset Management
6) Baupost Group
7) Fairfax Financial Holdings
8) Fairholme Capital
9) Trian Fund Management
10) Gotham Asset Management
11) Fir Tree Partners
12) Elliott Associates
13) Jana Partners
14) Gabelli Funds
15) Highfields Capital Management
16) Eminence Capital
17) Pershing Square Capital Management
18) New Mountain Vantage Advisers
19) Atlantic Investment Management
20) Scout Capital Management
21) Third Point
22) Marcato Capital Management
23) Glenview Capital Management
24) Apollo Management
25) Avenue Capital
26) Armistice Capital
27) Blue Harbor Group
28) Brigade Capital Management
29) Caspian Capital
30) Kerrisdale Advisers
31) Knighthead Capital Management
32) Relational Investors
33) Roystone Capital Management
34) Scopia Capital Management
35) Schneider Capital Management
36) ValueAct Capital
37) Vulcan Value Partners
38) Okumus Fund Management
39) Eagle Capital Management
40) Sasco Capital
41) Lyrical Asset Management
42) Gabelli Funds
43) Brave Warrior Advisors
44) Matrix Asset Advisors
45) Jet Capital
46) Conatus Capital Management
47) Starboard Value
48) Pzena Investment Management
Top Long/Short Hedge Funds
These hedge funds go long shares they think will rise in value and short those they think will fall. Along with global macro funds, they command the bulk of hedge fund assets. There are many L/S funds but here is a small sample of some well-known funds.
1) Adage Capital Management
2) Appaloosa LP
3) Greenlight Capital
4) Maverick Capital
5) Pointstate Capital Partners
6) Marathon Asset Management
7) JAT Capital Management
8) Coatue Management
9) Omega Advisors (Leon Cooperman)
10) Artis Capital Management
11) Fox Point Capital Management
12) Jabre Capital Partners
13) Lone Pine Capital
14) Paulson & Co.
15) Bronson Point Management
16) Hoplite Capital Management
17) LSV Asset Management
18) Hussman Strategic Advisors
19) Cantillon Capital Management
20) Brookside Capital Management
21) Blue Ridge Capital
22) Iridian Asset Management
23) Clough Capital Partners
24) GLG Partners LP
25) Cadence Capital Management
26) Karsh Capital Management
27) New Mountain Vantage
28) Andor Capital Management (it shut down again, for now)
29) Silver Point Capital
30) Steadfast Capital Management
31) Brookside Capital Management
32) PAR Capital Capital Management
33) Gilder, Gagnon, Howe & Co
34) Brahman Capital
35) Bridger Management
36) Kensico Capital Management
37) Kynikos Associates
38) Soroban Capital Partners
39) Passport Capital
40) Pennant Capital Management
41) Mason Capital Management
42) Tide Point Capital Management
43) Sirios Capital Management
44) Hayman Capital Management
45) Highside Capital Management
46) Tremblant Capital Group
47) Decade Capital Management
48) T. Boone Pickens BP Capital
49) Bloom Tree Partners
50) Cadian Capital Management
51) Matrix Capital Management
52) Senvest Partners
53) Falcon Edge Capital Management
54) Park West Asset Management
55) Melvin Capital Partners
56) Owl Creek Asset Management
57) Portolan Capital Management
58) Proxima Capital Management
59) Tiger Global Management
60) Tourbillon Capital Partners
61) Impala Asset Management
62) Valinor Management
63) Viking Global Investors
64) Marshall Wace
65) Light Street Capital Management
66) Honeycomb Asset Management
67) Whale Rock Capital
70) Suvretta Capital Management
71) York Capital Management
72) Zweig-Dimenna Associates
73) Rock Springs Capital Management
74) 12 West Capital Management
Top Sector and Specialized Funds
I like tracking activity funds that specialize in real estate, biotech, healthcare, retail and other sectors like mid, small and micro caps. Here are some funds worth tracking closely.
1) Armistice Capital
2) Baker Brothers Advisors
3) Palo Alto Investors
4) Broadfin Capital
5) Healthcor Management
6) Orbimed Advisors
7) Deerfield Management
8) BB Biotech AG
9) Ghost Tree Capital
10) Sectoral Asset Management
11) Oracle Investment Management
12) Perceptive Advisors
13) Consonance Capital Management
14) Camber Capital Management
15) Redmile Group
16) RTW Investments
17) Bridger Capital Management
18) Boxer Capital
19) Bridgeway Capital Management
20) Cohen & Steers
21) Cardinal Capital Management
22) Munder Capital Management
23) Diamondhill Capital Management
24) Cortina Asset Management
25) Geneva Capital Management
26) Criterion Capital Management
27) Daruma Capital Management
28) 12 West Capital Management
29) RA Capital Management
30) Sarissa Capital Management
31) Rock Springs Capital Management
32) Senzar Asset Management
33) Southeastern Asset Management
34) Sphera Funds
35) Tang Capital Management
36) Thomson Horstmann & Bryant
37) Venbio Select Advisors
38) Ecor1 Capital
39) Opaleye Management
40) NEA Management Company
41) Great Point Partners
42) Tekla Capital Management
Mutual Funds and Asset Managers
Mutual funds and large asset managers are not hedge funds but their sheer size makes them important players. Some asset managers have excellent track records. Below, are a few funds investors track closely.
1) Fidelity
2) Blackrock Fund Advisors
3) Wellington Management
4) AQR Capital Management
5) Sands Capital Management
6) Brookfield Asset Management
7) Dodge & Cox
8) Eaton Vance Management
9) Grantham, Mayo, Van Otterloo & Co.
10) Geode Capital Management
11) Goldman Sachs Group
12) JP Morgan Chase & Co.
13) Morgan Stanley
14) Manulife Asset Management
15) RCM Capital Management
16) UBS Asset Management
17) Barclays Global Investor
18) Epoch Investment Partners
19) Thornburg Investment Management
20) Legg Mason (Bill Miller)
21) Kornitzer Capital Management
22) Batterymarch Financial Management
23) Tocqueville Asset Management
24) Neuberger Berman
25) Winslow Capital Management
26) Herndon Capital Management
27) Artisan Partners
28) Great West Life Insurance Management
29) Lazard Asset Management
30) Janus Capital Management
31) Franklin Resources
32) Capital Research Global Investors
33) T. Rowe Price
34) First Eagle Investment Management
35) Frontier Capital Management
36) Akre Capital Management
37) Brandywine Global
38) Brown Capital Management
39) Victory Capital Management
Canadian Asset Managers
Here are a few Canadian funds I track closely:
1) Addenda Capital
2) Letko, Brosseau and Associates
3) Fiera Capital Corporation
4) West Face Capital
5) Hexavest
6) 1832 Asset Management
7) Jarislowsky, Fraser
8) Connor, Clark & Lunn Investment Management
9) TD Asset Management
10) CIBC Asset Management
11) Beutel, Goodman & Co
12) Greystone Managed Investments
13) Mackenzie Financial Corporation
14) Great West Life Assurance Co
15) Guardian Capital
16) Scotia Capital
17) AGF Investments
18) Montrusco Bolton
19) Venator Capital Management
Pension Funds, Endowment Funds, and Sovereign Wealth Funds
Last but not least, I the track activity of some pension funds, endowment and sovereign wealth funds. I like to focus on funds that invest in top hedge funds and have internal alpha managers. Below, a sample of pension and endowment funds I track closely:
1) Alberta Investment Management Corporation (AIMco)
2) Ontario Teachers' Pension Plan
3) Canada Pension Plan Investment Board
4) Caisse de dépôt et placement du Québec
5) OMERS Administration Corp.
6) British Columbia Investment Management Corporation (bcIMC)
7) Public Sector Pension Investment Board (PSP Investments)
8) PGGM Investments
9) APG All Pensions Group
10) California Public Employees Retirement System (CalPERS)
11) California State Teachers Retirement System (CalSTRS)
12) New York State Common Fund
13) New York State Teachers Retirement System
14) State Board of Administration of Florida Retirement System
15) State of Wisconsin Investment Board
16) State of New Jersey Common Pension Fund
17) Public Employees Retirement System of Ohio
18) STRS Ohio
19) Teacher Retirement System of Texas
20) Virginia Retirement Systems
21) TIAA CREF investment Management
22) Harvard Management Co.
23) Norges Bank
24) Nordea Investment Management
25) Korea Investment Corp.
26) Singapore Temasek Holdings
27) Yale Endowment Fund
Below, Dan Loeb's Third Point files its 13F, which shows the company eliminated its stake in Hewlett Packard Enterprise, decreased its stake in Alphabet, and increased its Alibaba, reports CNBC's Leslie Picker.
And CNBC's Seema Mody reports the number of hedge funds trading cryptocurrencies has exploded since the start of the year. Even hedge fund juggernaut Man Group is jumping on the cryptocurrency frenzy.
I don't know, what's that old saying, if it quacks like a duck... -:)
Dan Loeb's Third Point files 13F from CNBC.
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