In its latest 13F filing with the U.S. Securities and Exchange Commission, Hudson Bay Capital Management, managed by Sander Gerber, disclosed the holdings in its public equity portfolio as of the reporting period of March 31. The New York City-based fund focuses on catalyst-driven absolute return strategies, and held a public equity portfolio valued at $3.76 billion as of March 31, mainly consisting of finance, technology, and healthcare stocks. During the first quarter, Hudson Bay Capital bought shares of more than 70 companies, and sold out of position in over 85 others. In this article, we will talk about Hudson Bay Capital’s top long positions in tech stocks, which were Yahoo! Inc. (NASDAQ:YHOO), Alibaba Group Holding Ltd (NYSE:BABA), and Apple Inc. (NASDAQ:AAPL).
At Insider Monkey, we track hedge funds to learn about their investment strategies. According to our research, hedge funds’ large-cap stock picks historically delivered a monthly alpha of six basis points, though these stocks underperformed the S&P 500 Total Return Index by an average of seven basis points per month between 1999 and 2012. These stocks were able to generate alpha because of their lower risk profile. On the other hand, the 15 most popular small-cap stocks among hedge funds outperformed the S&P 500 Index by an average of 95 basis points per month. These stocks were slightly riskier, so their monthly alpha was 80 basis points (read the details here). Since the official launch of our small-cap strategy in August 2012 it has performed just as predicted, returning over 144% and beating the market by more than 84 percentage points.
Let’s discuss Hudson Bay Capital’s top tech stocks, starting with Yahoo! Inc. (NASDAQ:YHOO), a new position which the investor disclosed owning 3.25 million shares of, valued at $144.47 million. Yahoo! Inc. (NASDAQ:YHOO) is one of the most popular technology stocks among billionaires, with a total of 15 billionaires holding stakes in the company. Yahoo! Inc. (NASDAQ:YHOO) is planning to spin off its stake in Alibaba Group Holding Ltd (NYSE:BABA) and seems to be very confident about the spin off, which is planned for the fourth quarter of 2015. However, some experts believe that Yahoo’s move to spin off its stake in Alibaba might face some regulatory hurdles and might be subjected to a tax review, which could greatly diminish the value of the move. Yahoo’s stake in Alibaba is valued at around $15 billion. Shares of Yahoo have lost 16.34% year-to-date, partly over that uncertainty. Among the largest shareholders of Yahoo is Daniel S. Och’s OZ Management, which boosted its stake in the company by 63% to 14.65 million shares during the first quarter.