Hedge Fund News: Warren Buffett, Paul Singer & Carl Icahn

4 stocks Warren Buffett and insiders love (MarketWatch)
In this article we look into four companies that are in Warren Buffett‘s portfolio and have witnessed insider purchases over the past three months. First on our list is Phillips 66 (NYSE:PSX), a downstream energy company with a market cap that surpasses $46 billion. Although in the last 13F form filed by Berkshire Hathaway Inc. (NYSE:BRK.B) the fund declared that its position in the company remained unchanged over the third quarter of 2013, its bets are still quite high. The fund owns more than 27 million shares—valued at over $2 billion—which account for almost 2% of the total value of its equity portfolio.

hedge funds vs. mutual funds

Hedge-Fund Manager Paul Singer ‘Shocked’ by Bitcoin Popularity (Wall Street Journal)
One of the bigger names in hedge funds has come out against Bitcoin – and in favor of beaten-down gold. Paul Singer, founder of $23.3 billion Elliott Management Corp., told investors he was “shocked” by the virtual currency Bitcoin’s popularity and skeptical of its long-term prospects, according to a quarterly letter sent this week. “There is no more reason to believe that Bitcoin will stand the test of time than that governments will protect the value of government-created money, although Bitcoin is newer and we always look at babies with hope,” Mr. Singer wrote.

As Apple shares fall, Icahn buys another $500 million (MSN Malaysia News)
Hedge fund billionaire Carl Icahn said he bought another half a billion dollars’ worth of Apple Inc. (NASDAQ:AAPL) stock yesterday, signaling confidence in the iPhone maker even after it gave a disappointing revenue forecast for the current quarter. The investment, Icahn’s third in Apple in less than a week, boosts the value of stake in the company to more than $4 billion (RM13.3 billion). It was announced via his Twitter account as Apple’s shares traded down about 8% following its quarterly report late on Monday, which renewed Wall Street’s concerns about the maturing smartphone market. Icahn told Reuters in a telephone interview that the decline in Apple shares presented “a great opportunity” to add to his position.

U.S. rests its case in insider trading trial of SAC’s Martoma (Reuters)
Steven A. Cohen tried to sell stock as quietly as possible as SAC Capital Advisors unwound positions at the center of an insider trading trial, the hedge fund’s head trader said on Thursday. The testimony came as the government called its final witnesses in the trial of former portfolio manager Mathew Martoma, putting the case within days of its conclusion. Martoma, 39, is accused of using inside information about a drug trial to trade in the stock of Elan Corporation, plc (ADR) (NYSE:ELN) and Wyeth that helped SAC Capital make profits and avoid losses of $276 million.

Diamondback Co-Founder Likes Banks (FINalternatives)
The co-founder of Diamondback Capital Management is bullish on banks at his new hedge fund. Richard Schimel, who is also SAC Capital Advisors founder Steven Cohen’s brother-in-law, told clients of his newly-launched Sterling Ridge Capital Management that certain banks—specifically those doing little fixed-income trading and restructured retail-focused entities—should do well this year, Reuters reports. Schimel did not identify any of his positions by name.

Rich hedge fund managers feel poor’s pain (CNBC.com)


Leon Cooperman Talks Emerging Markets, 2014 Market Prediction (Insider Monkey)
Leon Cooperman is one of the legendary hedge-fund voices that investors listen to for guidance about the markets and stocks. As the head of Omega Advisors, Cooperman has been at this fedge-fund game for a lot of years and has become one of the icons in the investing business. “If you look at the emerging market issue, while not insignificant, it’s not major,” Cooperman said. “Seventy-five percent of the world’s GDP is either stable or expanding. The U.S. economic growth is accelerating a bit. Europe is turning up. Japan is expanding. China is growing somewhere in the area of 6 to 7 percent.

Blackstone-backed hedge fund goes long (Financial News)
Carrhae Capital, an emerging markets-focused hedge fund manager that received a seed investment from alternatives giant The Blackstone Group L.P. (NYSE:BX), is planning to launch a long-only fund next month. The move is driven by investor demand — mainly from US endowments and foundations — after Carrhae’s hedge fund substantially outperformed the emerging markets benchmark in the two years since its inception, according to a person familiar with the situation. The long book of Carrhae’s hedge fund outperformed the MSCI Emerging Markets Index by over 13 percentage points in 2012 and by 28.5 percentage points in 2013, before fees, according to a fund presentation.

Elliott Rejects Gramercy’s Argentina Proposal as a ‘Stunt’ (Bloomberg)
Billionaire Paul Singer’s hedge fund Elliott Management Corp. said efforts by holders of Argentina’s restructured debt to resolve a legal dispute over bonds from the nation’s 2001 default are “bizarre.” Elliott, which has sued for full repayment on defaulted bonds in U.S. courts, will only negotiate a settlement with Argentina directly, the fund said in a letter to investors obtained by Bloomberg News. A proposal by hedge fund Gramercy Funds Management LLC called for holders of restructured debt to cede a portion of their interest payments to holdouts.

Sotheby’s To Pay Special Dividend Amid Pressure From Investor (Wall Street Journal)
Sothebys (NYSE:BID) said Wednesday that it would pay shareholders a $300 million special dividend in March, and might sell its New York headquarters, as the auction house works to fend off an assault by activist hedge fund manager Daniel Loeb. The company also said it may buy back $150 million in stock and is considering options for its Bond Street property in London. The moves are the result of a financial review that began in September, a month before Mr. Loeb sent the company an incendiary public letter calling on Chief Executive William Ruprecht to step down and saying the company was like “an old master painting in desperate need of restoration.”

Vornado and SL Green lure hedge funds to 280 Park (The Real Deal Magazine)
Vornado Realty Trust (NYSE:VNO) and SL Green Realty Corp (NYSE:SLG) have signed two hedge funds to their jointly-owned office building at 280 Park Avenue, The Real Deal has learned. Napier Park Global Capital, a spinoff from Citigroup Inc (NYSE:C), will take 25,000 square feet on the third floor of the building, while Mount Kellett Capital Management will set up right above them on the fourth floor in a deal for up to 35,000 square feet. Napier Park, which manages $5.6 billion in credit assets, was spun off from Citi last year to comply with new restrictions on proprietary trading by banks. It will pay rents starting in the low-$80s per square foot at the 1.2 million-square-foot Midtown East tower at 48th Street, according to data from CompStak.

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