Apart from his family office Point72 Asset Management, billionaire trader Steve Cohen also manages his personal fortune through Asia-focused subsidiaries, Point72 Asia (Singapore) and Point72 Asia (Hong Kong). These subsidiaries were recently in news after several employees left the firm and they had to hire and promote analysts to replenish their talent pool. Though Point72 Asia (Singapore) and Point72 Asia (Hong Kong) Ltd primarily invest in Asian equities, they also manage sizeable US equity portfolios. At the beginning of this year Point72 Asia (Singapore) submitted its first 13F filing with the Securities and Exchange Commission (SEC), revealing a US equity portfolio worth almost $271 million at the end of December. Our analysis of Point72 Asia (Singapore)’s 13F showed that the fund’s nine holdings in companies with a market cap at least $1 billion posted weighted average return of 11% in the first quarter. Since Point72 Asia (Singapore) managed to perform so well despite the extreme volatility in the market and at a time when the broader market generated no returns, in this post, we are going to take a look at the fund’s top five US holdings from its last 13F filing and analyze how they performed during the first quarter.
We track prominent investors and hedge funds because our research has shown that historically their stock picks delivered superior risk-adjusted returns. This is especially true in the small-cap space. The 15 most popular small-cap stocks among a select group of investors delivered a monthly alpha of 80 basis points between 1999 and 2012 (see the details here).
#5 Alcoa Inc (NYSE:AA)
– Shares Owned by Point72 Asia (Singapore) (as of December 31): 2.63 million
– Value of Holding (as of December 31): $26 million
Let’s start with Alcoa Inc (NYSE:AA), which lost more than one-third of its market capitalization last year. Apart from Point72 Asia (Singapore), billionaire Paul Singer‘s Elliott Management also initiated a stake in the company during the fourth quarter by purchasing 67.1 million shares and ranked as the largest shareholder of the company at the end of December among funds in our database. Shares of Alcoa Inc (NYSE:AA) started 2016 on a terrible note by falling over 30% at the beginning of the year. However, a rally in aluminum prices helped them to narrow down their losses and end the first quarter down by only 2.5%. The company is currently in the process of splitting its valued-added business into a separate publicly traded company ‘Arconic’and expects this spin-off to get completed in the second-half of this year. In the last few months the company has been focusing on strengthening its balance sheet by selling non-core assets, which has been appreciated by analysts. On April 6, analysts at Macquarie reiterated their ‘Outperform’ rating on the stock, and raised their price target to $12 from $11.