Hedge fund managers are considered to be the smartest guys in the market, but they charge high fees to manage their customers’ money and are very quiet about the moves they make. However, every three months these hedge funds disclose their equity holdings with the Securities and Exchange Commission in a document known as the 13F statement. Reviewing which retail stocks were added or subtracted by the top hedge fund managers can be revealing.
In the latest release of 13F statements, several hedge funds dropped Alibaba from their stock portfolios. The Chinese Internet giant has seen its stock price drop more than 25 percent year-to-date. But while Alibaba was getting cast off, Amazon was either getting added or existing positions were increased.
Soros Fund Management, which averages a 20 percent rate of return every year, added Amazon, as did Duquesne Family Office and Lone Pine Capital. The funds that boosted their stakes in Amazon included Landsdowne Partners, Tiger Global and Viking Global.
Greenlight Capital Inc. added to its positions in Michael Kors and Dillard’s, but is no longer showing a position in Macy’s. In a letter to investors, Greenlight’s David Einhorn said this about Kors, “The investment community harshly reacted to a shutdown at a distribution center, which led to a temporary halt in e-commerce sales and ongoing concerns that the company is a ‘fad.'” Einhorn believes both of those issues are now resolved. Greenlight Capital lost 14.3 percent during the third quarter and its year-to-date net return is a negative 17.1 percent.
Ebay also saw a lot of activity on both sides of the trade. Corvex Management reported a new stake in eBay, while Third Point and Soros Fund Management both boosted their holdings. Others cut eBay loose, including Coatue Management and Icahn Associates, which both no longer show a position in the online marketplace.
Tiger Global dropped several retail positions including JD.com, MasterCard and Kate Spade & Co. Viking Global also dropped its MasterCard position, perhaps taking a profit since MasterCard is up 13 percent year to date.
Bridgewater Associates also took an interest in retail stocks. This fund established new positions in Ralph Lauren and shipper Federal Express. Bridgewater also added to its position in Kohl’s.
Lansdowne Partners, in addition to the Amazon holding, boosted its L Brands, Nike and Visa positions. New retail stakes included Blue Harbor’s jump into Fossil and Duquesne’s addition of Under Armour.
Lululemon, once a darling of the investment community, only saw one new addition and that was with Point72 Asset Management. Point72 is led by Steve Cohen, who ran SAC Capital until it was shut down following a guilty plea to 2013 charges of insider trading. The Point72 firm only manages his own family’s money.