Although most hedge funds are not expected to report their third-quarter holdings until Monday’s deadline, several filed by last Friday. On one hand, a number of funds reported that they had liquidated their entire stakes in troubled drug maker Montreal-based Valeant Pharmaceuticals International in the third quarter. So far, the sellers include two multi-strategy firms—New York-based Millennium Management, which unloaded more than one million shares, and Chicago-based Citadel, which sold more than 430,000 shares (it also sold all of its put and call option positions). We earlier reported that New York-based Tiger Seed liquidated its entire stake.
On the other hand, several firms boosted their stakes in the embattled drug maker. New York-based BlueMountain Asset Management raised its position from 504,000 to 617,000 shares while New York’s Marble Arch Investments, headed by Scott McLellan and Timothy Jenkins, who are Tiger Cubs and Seeds, raised its position to nearly 1.2 million shares, enabling the drug maker to remain its largest position, accounting for more than 16 percent of its portfolio. Valeant represented 20 percent of its U.S. stock portfolio the prior quarter. Shares of Valeant climbed 2.2 percent on Friday to close at $75.41 on an otherwise rough day for the stock market.
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Several high-profile honchos have liquidated their stakes in Alibaba Group Holding, the Chinese e-commerce giant. They include Stanley Druckenmiller’s family office, New York-based Duquesne Family Office, David Tepper’s Short Hills, New Jersey-based Appaloosa Management, which owned 1.36 million shares, Philippe Laffont’s New York–based Coatue Management and Daniel Benton’s Rye Brook, New York-based Andor Capital Management, according to their filings of third-quarter U.S. stock holdings.
Druckenmiller’s family office also more than doubled its stake in Menlo Park-based Facebook, making it the firm’s No. 1 holding. In case you are wondering, the one-time head trader for George Soros did not own any shares of Valeant Pharmaceuticals in the second quarter and did not buy any in the third quarter.
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Seth Klarman’s Boston-based Baupost Group all but gave up on the Boise, Iowa semiconductor maker Micron Technology, unloading 94 percent of its shares. Micron had been the fifth-largest stock in the eclectic manager’s roughly $6 billion U.S. stock portfolio. Baupost currently manages $27 billion, down from $28.5 billion at the beginning of the year.
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Nelson Peltz’s Trian Fund Management established new positions in two stocks—Pentair, the Manchester, U.K. industrial company, and Chemours, The Wilmington, Delaware specialty chemical company spun off last year from DuPont. The New York activist also retains a big stake in DuPont.
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Laffont’s Coatue Management nearly tripled its stake in Netflix, making the Los Gatos, California streaming-media giant the hedge fund’s third-largest holding. It also trimmed its position in its two top holdings—Apple and Facebook.
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David Tepper’s Short Hills, New Jersey-based Palomino Fund was down 0.67 percent in October, trimming its gain for the year to roughly 9 percent. Although the hedge fund did not participate in much of the October stock rally, Tepper has played a shrewd, deft game of defense this summer, enabling him to head into the final two months of the year in solid shape.
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Izzy Englander’s New York-based multi-strategy fund Millennium International was down 0.42 percent in October, trimming its gain for the year to around 9.65 percent.
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Total assets invested in Asian-focused hedge funds fell by $8.7 billion, or nearly 7 percent in the third quarter, to roughly $117.5 billion. Investor withdrawals accounted for a little less than $1 billion while performance-based losses approached $8 billion, according to Chicago-based HFR. Meanwhile, Asian hedge funds focused on investing in China posted gains of 5.2 percent in October after plummeting 15.4 percent in the third quarter. Even so, the HFRI China Index is up 5.2 percent for the year. The Shanghai Composite Index plunged 28.6 percent in the third quarter.
