This content is from: Portfolio

The Morning Brief: The Long(s) and Short(s) of Herbalife; Soros Takes a Bigger Bite of Apple

Herbalife gets a boost. Herbalife stock gained 3 percent Tuesday to close at $39.74 in extended trading on news that the nutrition supplements purveyor beat fourth-quarter earnings estimates. Bundled along with the quarterly results was a nod to the company’s most vociferous detractor yet, hedge fund investor William Ackman. The Los Angeles, California, company said it is raising its fiscal year 2013 earnings per share guidance to a range of $4.45 to $$4.65. The guidance excludes one-time costs of $10 million to $20 million in legal and advisory fees associated with responses to information publicized “by a short-seller,” information that it said it believes to be “inaccurate and misleading.”

Separately, on the opposite side of the equation, hedge fund manager Daniel Loeb has sold part of his long position in Herbalife, according to CNBC, quoting an unnamed source. Loeb’s Thirdpoint, started selling a few weeks ago and has continued to trade around the position, CNBC said, including this past Friday. On Friday Herbalife shares surged, spurred by Carl Icahn’s disclosure in a 13D filing revealing a 12.98 percent stake in Herbalife. The February 14 filing looked to be Icahn’s Valentine to himself.

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The news Tuesday that Apple’s computers were hacked by a sophisticated virus isn’t the type of thing that would worry Soros Fund Management. The Soros’ fund vehicle disclosed in a 13F February 19 that it had raised the ante on the computer maker by 73% during the fourth quarter. Despite the continuing selloff, Soros evidently belongs to the camp that believes the stock is undervalued. After trading narrowly, shares of Apple closed just $0.12 off Tuesday, at $460.04.

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Asian hedge funds posted their best-ever January returns, adding 4.15 percent, FINalternatives reported, citing Eurekahedge data. Funds based in the region added 9.79% in 2012 and now manage US$127.8 billion. Japanese hedge funds delivered their best monthly return since December 2005 and their strongest January return on record — up 5.25% January was a strong month for hedge funds generally, as they posted their strongest returns in 24 months, adding 2.32%.

In time for new CEO Emmanuel Roman to assume his post, Man Group, the world’s biggest publicly traded hedge fund manager, merged two computer driven hedge fund units and announced management changes, Bloomberg News said. Luke Ellis, formerly head of the FRM fund of hedge funds unit, was named president of the firm. He will oversee the investment operations of Man’s three main investment division — FRM, GLG Partners and ALM, which manages the largest hedge fund, AHL.

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