Adam Wright and Gary Kohler’s Blue Clay Capital performed much better than Index Funds in the first quarter, as its 27 long positions in stocks with a market cap above $1.0 billion as reported in its latest 13F filinghad weighted average returns of 15.4%. The S&P 500 ETF (SPY) on the other hand, delivered an average return of 0.9% during the same period. The large returns achieved by Blue Clay Capital’s picks, stem partially from the great performance of its holdings in Apple Inc. (NASDAQ:AAPL), Google Inc (NASDAQ:GOOG), JetBlue Airways Corporation (NASDAQ:JBLU), Select Comfort Corp. (NASDAQ:SCSS), and Ligand Pharmaceuticals Inc. (NASDAQ:LGND) at the start of the year.
Before launching Blue Clay Capital in 2012, Gary Kohler and Adam Wright worked together at Whitebox Advisors for five years. While Mr. Kohler has more than 25 years of experience in managing family offices and hedge fund assets, Mr. Wright specializes in investment banking and corporate development. The investment management firm they founded focuses on small- and mid-cap stocks, while seeking out long-term business opportunities by employing fundamental valuation analysis. Blue Clay Capital’s investment team has vast experience in both public markets and private equities, as well as in venture capital and corporate development.
Blue Clay Capital made a smart move by entering a position in Apple Inc. (NASDAQ:AAPL) during the fourth quarter. The fund’s holding in the company, which amounts to roughly 22,300 shares valued at $2.46 million, generated an average return of 13.17%. Although its stake in Apple might seem small, it represents almost 2% of the investment firm’s equity portfolio, which was valued at $136.86 million at the end of 2014. In addition to Blue Clay Capital, numerous hedge funds benefited from holding a position in Apple Inc. (NASDAQ:AAPL). William Harnisch’s Peconic Partners for example, was able to beat the market this quarter by betting on Apple. However, as one of the company’s largest shareholders among institutional investors with a stake of 52.76 million shares, Carl Icahn’s Icahn Capital LP had the most to gain from the stock’s solid performance.
Although Google Inc (NASDAQ:GOOG) did not perform as well as some of Blue Clay Capital’s other picks, it still managed to return 4.10% during the first quarter. The hedge fund holds 8,500 shares underlying call options, valued at $4.47 million, which represent 3.27% of the value of its equity portfolio. The fact that Blue Clay is betting on this stock comes as no surprise, since Google Inc (NASDAQ:GOOG) is one of the 10 most popular tech stock picks among hedge funds. Other firms holding a stake in the company include Boykin Curry’s Eagle Capital Management, Ken Fisher’s Fisher Asset Management, and Andreas Halvorsen’s Viking Global.
JetBlue Airways Corporation (NASDAQ:JBLU) was one of Blue Clay Capital’s most profitable stock picks, as it returned 21.37% this quarter. The fund owns 89,800 shares of the company’s stock, as well as 100,000 shares underlying call options. James Dondero’s Highland Capital Management has also been betting on JetBlue Airways Corporation (NASDAQ:JBLU) since the beginning of the year, disclosing ownership of 2.29 million shares in its most recent 13F filing.