The Battle of the Billionaire Stock Traders
Four times a year, the rest of us get to watch as billionaires try to outsmart each other.
Usually, the stock market strategies of the nation's richest people are closely guarded secrets. Yet every quarter, the U.S. Securities and Exchange Commission requires large investment managers to disclose their holdings in a so-called 13F form.
Last quarter's 13Fs are out and they demonstrate -- if it wasn't clear already -- that the world's savviest investors can have diametrically opposed views of the market.
While Apple shares were falling 17 percent last quarter (from January through March), David Einhorn's Greenlight Capital was buying up 1.09 million shares, bringing his stake to $1.06 billion. That's 16 percent of his portfolio.
Meanwhile, billionaire David Tepper's hedge fund, Appaloosa Management, cut its Apple stake 41 percent, and George Soros's Soros Fund Management cut 85 percent of its Apple holdings. Paul Tudor Jones' Tudor Investment Corp. sold every one of its 386,124 shares.
Other stocks that divided the financial titans included Virgin Media. Daniel Loeb's Third Point hedge-fund firm bought up $538.7 million of Virgin's stock, while Steven A. Cohen's SAC Capital Advisors sold its entire $49.2 million holding. The global packaging company MeadWestvaco Corp. attracted the Soros Fund, which bought up $66.4 million in stock, even as Nelson Peltz's Trian Fund dumped all $50.8 million of its holdings.
Both sides of these trades can't be right. Unlike some other business deals, trading stocks is a zero sum game, with a winner and a loser. (Sometimes two losers if you include taxes and transaction costs.) As countless examples show, being right in the past is no guarantee you won't be someone else's lunch in the future.
Bloomberg TV's Dominic Chu has more on this quarter's 13F filings here.