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Melvin Capital Management’s Returns, AUM, and Holdings

A former SAC Capital star trader, Gabriel Plotkin started his own fund at the end of 2014, called Melvin Capital Management, named after Plotkin’s late grandfather. Gabriel Plotkin sharpened his investment philosophy as a portfolio manager at Sigma Capital, which was SAC Capital’s (now known as Point72 Asset Management) subsidiary, where he managed a $1.3 billion portfolio centered on stocks from the Consumer Products industry. Big earnings came fast for Gabriel Plotkin, who found himself among Forbes’ list of the Highest Earning Hedge Fund Managers 2018. He earned his Bachelor of Arts in Economics from Northwestern University.

Not only did Gabriel Plotkin receive the blessing of his former boss, billionaire Steve Cohen, but also a $200 million seed capital to help launch Melvin Capital. The fund attracted a great deal of initial interest, raising $700 million in capital. During its relatively short existence, the fund, which focuses on the Consumer Discretionary sector, has seen some amazing returns. In 2015 Melvin Capital Management generated a remarkable return of 47%, placing it among Bloomberg News’ top-performing hedge funds with $1 billion in assets under management. Not only that, in its first year it managed to outperform Point72 Asset Management, which returned 15.5% in 2015. Melvin Capital Management’s most valuable long positions then included stakes in McDonald’s (MCD), Dollar Tree (DLRT), Domino’s Pizza (DPZ), and Constellation Brands (STZ), to name a few.

Gabriel Plotkin Melvin Capital Management

Last year was also a fantastic one for Melvin Capital Management, as it generated an impressive return of 41% net of fees. According to Melvin Capital’s plain brochure, on December 31, 2016, the fund had $1.87 billion in assets under management on a discretionary basis. According to Business Insider, that figure was nearly doubled during the first nine months of 2017, as it raised its asset under management to $3.5 billion. At the end of June of this year, the fund’s 13F portfolio was valued at $11.06 billion.

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 121% vs. a cumulative gain of 66.6% for the S&P 500 ETF (SPY) (see the details here).

During the second quarter of 2018, Melvin Capital made several changes to its portfolio. It added 58 new positions, raised its stake in 26 existing holdings, lowered its position in 28 stocks, and dumped 37 stocks. You can read more about these changes on the next page.

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