Melvin Capital is an NYC-based hedge fund that was launched 5 years ago by Gabriel Plotkin with a part of seed money ($200 million ) coming from his former boss, billionaire Steve Cohen. Hence, prior to forming his own hedge fund, Gabriel Plotkin was a star trader at SAC Capital (now known as Point72 Asset Management). Last year, Gabriel Plotkin found its place among Highest Earning Hedge Fund Managers according to Forbes. He graduated with a BA in Economics from Northwestern University.
Even though a short one, the fund’s track record was a very good one. In 2015 the fund returned an eye-popping 47%, outperforming in its first year of existence Point72 Asset Management which generated a return of 15.5% in the same period. In 2017, the fund was blessed with another exquisite year in terms of performance, generating 41% net of fees. In this article, we are going to take a look at Melvin Capital’s most recent investment moves.
Insider Monkey’s flagship strategy identifies the best performing 100 hedge funds at the end of each quarter and invests in their consensus stock picks. This way it is always invested in the best ideas of the best performing hedge funds and is able to generate much higher returns than the market. Since its inception in May 2014, our flagship strategy generated a cumulative return of 103%, beating the S&P 500 ETF (SPY) by nearly 38 percentage points (see the details here). Our best performing hedge funds strategy also returned 26.4% year-to-date and outperformed the S&P 500 Index by nearly 12 percentage points. We take a closer look at hedge funds like Melvin Capital Management in order to identify their best and worst ideas.
At the end of Q1 2019, Melvin Capital’s equity portfolio was valued at $22.03 billion, and it was diversified. The top new positions included Alibaba Group Holding Limited (NYSE:BABA), Advance Auto Parts, Inc. (NYSE:AAP), salesforce.com, inc. (NYSE:CRM), and Lululemon Athletica Inc. (NASDAQ:LULU). The stocks that raised the fund’s optimism (stakes) during the quarter were Netflix, Inc. (NASDAQ:NFLX), Las Vegas Sands Corp. (NYSE:LVS), and Worldpay, Inc. (NYSE:WP).
The top exits counted Constellation Brands, Inc. (NYSE:STZ), Autodesk, Inc. (NASDAQ:ADSK), IAC/InterActiveCorp (NASDAQ:IAC), and Alphabet Inc. (NASDAQ:GOOGL). And the positions Melvin Capital lowered during the quarter included First Data Corporation (NYSE:FDC), Amazon.com, Inc. (NASDAQ:AMZN), Mastercard Incorporated (NYSE:MA), and PagSeguro Digital Ltd. (NYSE:PAGS).
This article is originally published at Insider Monkey.