Editor’s Note: Related tickers: Apple Inc. (NASDAQ:AAPL), Deutsche Bank AG (NYSE:DB), J.C. Penney Company, Inc. (NYSE:JCP)
While most hedge funds were most likely unable to keep with the S&P 500 in the first quarter, when the benchmark surged 10 percent, at least two funds — Jeffrey Ubben’s ValueAct Partners and the Egerton Capital in the U.K. — managed to match the index. ValueAct, a hedge fund manager with offices in San Francisco and Boston, was up 10 percent for the first three months, net of fees. This means its gross returns outperformed the index. ValueAct is known for taking a relatively small number of positions, primarily in activist situations. Last year, ValueAct was up 20.5 percent.
Apple Inc. (AAPL), Clearwire Corporation (CLWR): We’re Watching This Hedge Fund (InsiderMonkey)
Apple Inc. (NASDAQ:AAPL) is one of the smart money’s favorite stocks, and despite its selloff in recent months, it was still one of the most popular investments among the managers we watch heading into 2013. Yes, AIG overtook Apple at the end of last year—in terms of short-term appreciative performance and popularity—but it’s still worth pointing out which hedge fund managers hold Apple Inc. (NASDAQ:AAPL) in their portfolios. One of the funds on our radar screen is Sirios Capital, managed by John Brennan. Mr. Brennan’s $571 million equity portfolio is primarily split between the technology, services, and financial sectors. His top five stock picks account for nearly 30% of the Sirios 13F-attributable portfolio, and range from banking to blue chips.
Chasing the hedge-fund lie (MarketWatch)
If you’re the sort of investor who chases hedge funds, marking your calendar for the next disclosure of holdings from David Einhorn or John Paulson, you can quit reading. Almost nothing that follows is going to get through to you. You won’t be warned off by the facts: the reality of lackluster performance, the rigged advantages that average investors don’t enjoy, and the transparent hype. Nothing matters when you’re dazzled by the bright lights and overwhelmed by the sound of your own greed. It’s what makes the industry a $2.25 trillion one.
Frontier hedge fund investors eye Iraq (Risk)
A slate of telecoms IPOs and efforts to modernise banking regulations have some frontier market hedge funds enthused about prospects for Iraqi equities as institutional investors sit on the sidelines After a decade of war and destruction, efforts to restore Iraq’s economy and financial system are gaining traction. The economy expanded 10.5% last year, more than any other Middle Eastern country, and the GDP growth forecast for 2013 is nearly 13%. The local equity market is also hitting its stride.
Cerberus Turns Up Risk Factor (WSJ)
Cerberus Capital Management is braving one of the credit markets’ riskiest areas. The firm, known for its purchase of Detroit auto maker Chrysler LLC during the financial crisis, wants to buy the dicey portions of securities tied to commercial mortgages, people familiar with the fund said. In an investor presentation, Cerberus, a private-equity firm that operates hedge funds, headlines its “Market Outlook 2013” section with a title stating “Bad Habits are Returning,” referring to the growing use of debt in the commercial-real-estate market.
George Soros Holds Forth in Boao (WSJ)
George Soros keeps a low profile in China. Beijing authorities have long distrusted him for what they see as his ability to stir up trouble both as a currency speculator and a political activist. But he showed up this week at the Boao Forum for Asia, and filled a banquet hall at lunch on Monday to deliver a speech that roamed over a vast landscape, from Japan’s recent bond-buying binge to American politics. China Real Time was there with a notebook, and recorded some of the highlights.
Stock crash likely if rally continues: Marc Faber (MoneyControl)
In the near-term, the US stock market is overbought and adding that any more near-term gains portend big trouble for the market, “The Gloom, Boom and Doom Report” publisher Marc Faber told CNBC on Monday. “If we continue to move up, the probability of a crash becomes higher,” Faber predicted in a ” Squawk Box ” interview, saying it could happen “sometime in the second half of this year.” By his calculations, Faber said the bull market began four years ago with important stocks recently “breaking down,” such as Oracle and FedEx “Can we go up just on a few stocks like Johnson and Johnson, Procter and Gamble, Wal-Mart, and so forth?” he asked and answered: “Possibly.”
Icahn Enterprises MLP Surges 8.8% Early Monday (Barrons)
Clearly a lot of people read the current issue of Barron’s this weekend. Within it, on page 17, one can find a story by my colleague Andrew Bary arguing that there’s value to be found in Icahn Enterprises (IEP), the eponymous publicly traded master limited partnership of one Carl Icahn. …The $6 billion MLP has a concentrated portfolio of about 10 holdings. At $55, the units (as shares of an MLP are known) trade at a discount to the $64 sum-of-the-parts value, based on the company’s analysis, which has been updated by Barron’s based on the current share price of key publicly traded investments. The units yield a hefty 7%, reflecting a recently initiated $4-a-share annual payout.
Carlyle Says Saudi Opening Will Draw Investors on Ease of Exits (Bloomberg)
Saudi Arabia’s stock market will attract investors such as Carlyle Group LP (CG), the world’s second- biggest private-equity firm, when it opens to foreign investors, said Firas Nasir, co-head of the company’s MENA fund. “The Saudi market opening would attract investors like us more to Saudi as it would be easier to exit,” Nasir said today at the Bloomberg Doha conference. The Washington-based firm has made two of its about six investments in its $500 million Middle East and North Africa fund in Saudi Arabia, he said.
Steve Cohen’s Art Dealer Explains Why The Purchase Of A $155 Million Picasso Was Not A Slap In The Face To The SEC (BusinessInsider)
Reports surfaced a couple weeks ago that billionaire hedge fund manager Steve Cohen, whose SAC Capital has come under scrutiny lately, secretly bought Picasso’s “Le Rêve” from Steve Wynn for $155 million. It was assumed that Cohen had just purchased the painting after settling a $616 million insider trading probe with the Securities and Exchange Commission. That’s not the case.
Maples Hires New Americas Fund Services Head (Finalternatives)
Maples Fund Services has hired Jason Brandt, regional head of fund services for the Americas, to lead the firm’s growing presence in the region. Brandt, who joins Maple from Deutsche Bank Alternative Fund Services in London, has more than 18 years of experience in the financial services sector, focused primarily in hedge funds and private equity. At Deutsche Bank AG (NYSE:DB), he was responsible for client relationships globally, as well as growing the EMEA and Asia business. Prior to Deutsche Bank, he served as managing director and chief operating officer of Hedgeworks, which was acquired by Deutsche Bank in 2008. Brandt’s early career included positions with Capital Guardian Trust Company, Ernst & Young and Coopers & Lybrand.
Buy Herbalife! Ackman’s Foresight Under Fire Following JCPenney (JCP) Shakeup (StreetInsider)
Does Pershing Square’s Bill Ackman still have the magic touch? Following the ouster of Ron Johnson as CEO of J.C. Penney Company, Inc. (NYSE:JCP) on Monday night, some are asking hedge fund giant Bill Ackman what his thought’s are on the situation. Unfortunately, Ackman isn’t talking right now. The NY Post, which has been vocal on JCPenney and its problems since at least the start of 2013, points to one JCPenney insider who said, “Ackman is looking pretty foolish, as he is the guy who was beating the drum to get rid of Ullman in the first place.”
