Billionaire Julian Robertson Takes Out Huge SPY Hedge, Grows Bearish on Transportation Stocks

Page 1 of 2

Tiger Management is a New York-based hedge fund founded in 1980 by legendary investor and billionaire Julian Robertson. The original ‘Tiger Fund’, from which dozens of others have since spawned, has a public equity portfolio worth $423.32 million as of the end of the third quarter, well up from $310 million at the end of June, primarily due to a huge hedge against the SPY taken out by the fund during the third quarter. In this article we’ll take a look at Tiger Management’s top moves of the third quarter, including that bearish move.

Academic research has shown that certain insider purchases historically outperformed the market by an average of seven percentage points per year. This effect is more pronounced in small-cap stocks. Another exception is the small-cap stock picks of hedge funds. Our research has shown that imitating the 15 most popular small-cap stocks among hedge funds outperformed the market by nearly a percentage point per month between 1999 and 2012 (read more details).TIGER MANAGEMENT


Tiger Management took out a large position of put options underlying 389,200 shares of the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) in the third quarter. The stake had a total worth of $84.18 million at the end of the third quarter. While many funds hedge against some of their positions with put options, the size of this position says it was much more of a bearish bet against the broader markets than a simple hedge, as it accounted for nearly 20% of the value of the fund’s portfolio on September 30. The ETF is experiencing a massive inflow of money after the election of Donald Trump, as the markets touched new highs. Recent sessions added about $14 billion to the SPDR S&P 500 ETF Trust (NYSE:SPY), and the fund has gained 1.35% since Election Day, and over 7% since the start of the year. Shares did dip in early-November, though it’s unclear whether that would’ve been enough for Robertson to close on the position. Otherwise, it appears that the markets will have to fall back considerably, as they’ve jumped by over 5% since then.

Follow Apple Inc. (NASDAQ:AAPL)

Priceline Group Inc (NASDAQ:PCLN)

– Shares Owned by Tiger Management (as of September 30): 16,500

– Value of Tiger Management’s Holding (as of September 30): $24.28 million

The Tiger added 16,500 shares of Priceline Group Inc (NASDAQ:PCLN) to his fund’s portfolio in the third quarter, valued at $24.28 million. The company reported third quarter EPS of $31.18, better than the consensus estimate of $29.32, while revenue in the quarter came in at $3.69 billion, versus the consensus estimate of $3.62 billion. The Connecticut-based online travel agent sees fourth quarter EPS of between $12.20 and $12.80 a share, versus the consensus of $12.93. Earlier this year, Priceline’s CEO resigned after an internal investigation found him guilty of having an ‘inappropriate’ relationship with a company employee. A total of 85 hedge funds tracked by Insider Monkey were bullish on Priceline Group Inc (NASDAQ:PCLN) as of the end of the second quarter.

 – Don’t Miss: 10 Jobs that Allow You to Travel

Follow Booking Holdings Inc. (NASDAQ:BKNG)

On the next page, we’ll discuss the rest of Julian Robertson’s top Q3 moves.

Page 1 of 2