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The Morning Brief: Favorite High-Growth Hedge Fund Stocks Prove Volatile

Volatility continues to rock the high-flying momentum stocks, many of which are favored by hedge funds. Netflix, which is still a big holding of Carl Icahn’s even though he recently said he sold a big chunk of the streaming video company, fell nearly 2 percent Friday and is now down 16 of the past 18 trading days. It has also lost one-fifth of its value during that period. Other momentum stocks also fell nearly 2 percent on Friday, including Facebook. However, it was one among a handful of tech favorites that rose on Thursday. On the other hand, Tesla Motors, which fell on Thursday, rebounded by more than 2 percent on Friday. Google and Priceline.com were also up on Friday, but each by less than 1 percent.

Steve Cohen’s SAC Capital Advisors — he has not yet officially changes his family office’s name to Point72 Asset Management as planned — has more than doubled its stake in Zynga to 39.9 million shares, or 5.3 percent of the total outstanding. It was disclosed in a 13G filing, meaning the investment is passive. Shares of the online social games provider closed down more than 1 percent on Friday, to $4.42. It traded over $14.00 just 13 months ago. Cohen also disclosed he established a 5 percent stake in Midstates Petroleum, an independent exploration and production company. He did not own any shares in the company at the end of 2013.

Another hedge fund is shutting down. London-based OVS Capital Management, which manages $310 million, is closing after founder Sam Morland decided to retire, according to Bloomberg BusinessWeek. The event-driven fund was up 2.78 percent this year through February. Morland, 48, was previously CEO of the European office for Dallas-based HBK Capital Management.

J.C. Penney, which had surged nearly 80 percent from its February 4 nadir, cooled off a bit, dropping 1.67 percent.

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