Mortgage insurer Radian has been one of the most popular stocks among hedge funds – for good reason, apparently, as it has tripled in value over the past year. (It’s also significantly shorted, as some don’t yet believe that it will successfully turn itself around.) The recovering housing market is helping Radian, along with tighter lending rules likely to lead to greater need for its coverage — but that tighter lending could actually restrict its business. Radian’s recently reported second quarter featured losses narrowing and a 60% increase in new mortgage insurance written. Delinquent loans are a risk for Radian, as is strong competition. In July, its number of delinquent loans dropped a bit, and it recently announced a deal with Freddie Mac to reduce its claims exposure.
Finally, Citadel’s biggest closed positions included Virgin Media Inc. (NASDAQ:VMED) and Halcon Resources Corp (NYSE:HK). Other closed positions of interest include VirnetX Holding Corporation (NYSEMKT:VHC), an Internet software company with valuable patents. Some haven’t liked that it spends a lot of time in court — recently battling Apple Inc. (NASDAQ:AAPL), for example. It has also announced a patent license agreement with business communications expert Avaya that was enough to send the shares up more than 10%. Its CEO is the largest shareholder, but that has some folks worried, not reassured.
We should never blindly copy any investor’s moves, no matter how talented the investor. But it can be useful to keep an eye on what smart folks are doing, and 13-F forms can be great places to find intriguing candidates for our portfolios.
The article Here’s What This $58 Billion Hedge Fund Company Is Buying originally appeared on Fool.com.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.