By Sue Chang
The second quarter wasn't kind to some of Wall Street's best and
brightest, and the period's rough spots are likely to show up in a
coming wave of securities filings.
Institutional investment managers have 45 days after the end of
the prior calendar quarter to disclose their equity holdings. Some
have already made these 13F filings; others often wait till the
last minute, and these reports frequently show up after the regular
trading session.
Judging by the tepid performance of the stock market in the
second quarter, many of the high-profile stocks in their portfolios
are likely to have suffered.
The Dow Jones Industrial Average fell 2.5% in the three months
ended June 29, while the S&P 500 index slid 3.3% and the Nasdaq
Composite lost 5.1% for the quarter. Many individual stocks did a
lot worse.
Warren Buffett, one of the most respected investors in the
world, reported on May 15 that he bought 10 million shares of
General Motors Co. (GM) in the first quarter. The stock tanked 23%
in the second quarter to $19.72.
Billionaire George Soros's Soros Fund Management LLC bought into
J.P. Morgan Chase & Co. (JPM) and Goldman Sachs Group Inc. (GS)
in the first quarter. J.P. Morgan Chase slumped 22%, and Goldman
Sachs shed 23% in the April-June period.
Activist hedge fund manager Bill Ackman's Pershing Square
Capital Management owned large positions in J.C. Penney (JCP) and
Citigroup (C) at the end of March. J.C. Penney skidded 34% and Citi
surrendered 25% in the following three months.
Paulson & Co., John Paulson's hedge-fund firm, reported
stakes in Bank of America Corp. (BAC) and Caesars Entertainment
Corp. (CZR) in May. Bank of America stumbled 15% and Caesars, which
went public earlier this year, fell 23%. Paulson also holds a
sizable stake in the SPDR Gold Trust (GLD), which slid 4.3%.
On the whole, hedge funds lost money in the second quarter on
lingering European uncertainties, but still fared better than the
S&P 500 and the Nasdaq Composite indexes. The HFRI Fund
Weighted Composite Index, made up of 2,200 funds with at least $50
million under management, slid 2.7% in the second quarter, HFR said
last month.
Among Greenlight Capital Inc.'s marquee holdings, Apple Inc.
(AAPL) slipped 2.6% while Marvell Technology Group (MRVL) lost 28%.
David Einhorn's hedge fund reported a loss of 3.2% in the second
quarter due in part to the ongoing European crisis and bad calls on
Dell Inc. (DELL) and Best Buy Co. (BBY), which it exited at a
loss.
SAC Capital Advisors, managed by Steven Cohen, had increased its
stake in several tech companies, a move which it may be regretting.
Advanced Micro Devices Inc. (AMD) fell 29%, Cisco Systems Inc.
(CSCO) declined 19% and Hewlett-Packard Co. (HPQ) shed 16% in the
second quarter. Only Oracle Corp. (ORCL) eked out a gain of 1.9% in
the period.
Write to Sue Chang at AskNewswires@dowjones.com
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