Patrick Gideon Wolff’s Grandmaster Capital has filed a 13F with the Securities and Exchange Commission for the reporting period of March 31, disclosing the holdings in its equity portfolio as of that date. The fund, founded and managed by grandmaster chess player Wolff, is fundamentally driven, with a focus on stable businesses that can be invested in long-term. Furthermore, the fund emphasizes that it invests primarily in businesses (and industries) that it fully understands, which is why it was invested in just four sectors as of the latest reporting period: healthcare, finance, information technology, and consumer discretionary.
While Grandmaster may be the only fund we track headed by a grandmaster chess player (at least that we know of), it is one of only 700+ funds helmed by skilled money managers. We analyze the equity portfolios of those investors and collate their top small-cap picks quarterly as part of our small-cap strategy. Though most people believe tracking 13F filings to be a useless endeavor akin to battling a queen with a pawn, given that they are filed with a delay of a maximum of 45 days after the end of a calendar quarter, the results of our research prove that pawn is not so helpless after all. To be on the safe side, we used a delay of 60 days in our backtests that involved the 13F filings of funds between 1999 and 2012 and we still managed to gain an annual alpha in the double digits with these picks. Moreover, since the official launch of our strategy in August 2012, it has obtained returns of more than 137%, beating the S&P 500 Total Return Index by about 80 percentage points (see the details).
Howard Hughes Corp (NYSE:HHC) is king of the hill (or board) in Grandmaster’s portfolio, the holding moving up from fifth place at the end of 2014 to the top spot three months later, despite being reduced by 1% during the first quarter. The value of the position, comprised of 115,557 shares, increased to $17.91 million regardless, as shares rose by 18.86% during the quarter. It was those hefty returns that helped RIMA Senvest crush the market last quarter with Howard Hughes Corp (NYSE:HHC) as one of its top picks. The developer of master planned housing communities is also a top value investment of author and investor Whitney Tilson of Kase Management. Howard Hughes Corp (NYSE:HHC) is set to report its first quarter earnings this evening.
Anthem Inc (NYSE:ANTM) is the queen of Grandmaster’s portfolio, with the fund’s position of 108,890 shares having a value of $16.81 million. Like Howard Hughes, Anthem made a big move up the board thanks to a monster first quarter during which it returned 23.39%. Those returns vaulted it from ninth to second, despite the position also being trimmed slightly, by 5%. Formerly known as WellPoint, Anthem Inc (NYSE:ANTM) is coming off a very successful first quarter, one in which the health insurer posted big gains in profit and Medicaid enrollments. Adjusted earnings per share were a solid $3.02 for the quarter, a 32.5% increase year-over-year, and $0.35 higher than estimates. Anthem Inc (NYSE:ANTM) helped another of its big shareholders, Louis Navellier’s Navellier & Associates trump the market during the first quarter.