Hedge Fund Highlights: Warren Buffett, Bill Ackman & Richard Gerson

Fannie, Freddie investors ramp up push for companies’ revival (Hedgeworld)
Investors that have bid up the preferred and common shares of government-controlled Fannie Mae and Freddie Mac are starting to get louder. Leading the charge: consumer advocate Ralph Nader, a shareholder in the two companies who has aligned himself with some unlikely bed-fellows, including hedge funds. The groups are mounting a push to ensure that any decision on the future of the two taxpayer-owned mortgage finance giants helps shareholders salvage some of their money. Several hedge funds, including Perry Capital and Bruce Berkowitz‘s mutual fund Fairholme Fund, bought preferred stock of Fannie and Freddie cheaply and have filed lawsuits seeking to overturn the bailout agreement.

Citadel Defied a Market Slump in January (New York Times)
In a dismal month for the stock market, one big hedge fund company in Chicago managed to record gains. Citadel, the hedge fund giant led by Kenneth C. Griffin, told its investors on Wednesday that its two flagship funds rose 3.4 percent in January, according to a person briefed on the matter. The Standard & Poor’s 500-stock index declined 3.6 percent in that time. The month’s performance caps a strong run for the funds, called Kensington and Wellington, which have rebounded after suffering steep losses in the financial crisis. The funds returned 19.4 percent in 2013, a year when the median return of funds that use a similar strategy was 10.62 percent, according to Hedge Fund Intelligence.

Hedge funds bet on US gas shortage as cold boosts demand (Financial Times)
A rare fear haunts the land of the shale bonanza story: running low on natural gas. Furnaces, utilities and power plants have guzzled trillions of cubic feet of the fuel as the US slogs through what may be recorded as the coldest winter since the invention of gas futures in 1990. Hedge funds are now betting whether the country will face a critical shortage before spring. The wager comes with long odds but a huge possible payout. “It’s been a relentless cold,” says Eric Bass, managing partner at Velite Benchmark Capital Management, a Houston gas hedge fund. “This market has slowly started to realise there could potentially be an inventory problem.”

Deerfield Management Discloses Stake in Post-IPO Auspex Pharmaceuticals Inc (ASPX) (Insider Monkey)
James E. Flynn‘s Deerfield Management has revealed holding shares of Auspex Pharmaceuticals Inc (NASDAQ:ASPX), a company that went public today, on February 5. Deerfield reported ownership of around 1.29 million class E preferred shares. The securities can be converted into shares of common stock on the basis of 0.222 shares of Common Stock per one unit of Preferred Stock. According to the terms of the IPO, Auspex Pharmaceuticals Inc intended to sell 6.0 million shares at a price of $12 apiece. In this way following the IPO, the preferred stock of the company will be converted and the total amount of outstanding shares amounts to around 21.53 million.

SAC Capital Insider Jury Seeks Testimony Favoring Defense (Bloomberg)
The jury in the trial of former SAC Capital Advisors LP portfolio manager Mathew Martoma ended its second day of deliberations yesterday without a verdict, after asking to review testimony supporting his claim that details of a drug trial weren’t derived from inside information. The jury of seven women and five men, in a case prosecutors have called the most lucrative insider-trading scheme charged against an individual, sent a note to U.S. District Judge Paul Gardephe yesterday seeking a transcript of testimony by Thomas Wisniewski, a defense expert witness who is a professor of neurology, pathology and psychiatry at New York University’s Langone Medical Center.