What’s Next For Bullish Billionaire Tepper and Appaloosa? (GLD, TIP, BAC, C, WFC, AIG, PFE, MRK, JNJ, M, CF)
After cashing in on bailed out banks and other distressed investments in 2009 — to the tune of a 132.7% gain net of fees and a reported $4 billion personal payday — Appaloosa Management’s David Tepper offered a bullish outlook to CNBC in September. The Fed, according to Tepper’s interpretation, is saying, “We want economic growth, and we don’t care if there’s inflation.” The New Jersey-based fund manager also noted that multiple asset classes will benefit. Of course, Wall Street’s expectations for a second round of quantitative easing came to fruition last week, and despite pundits’ mixed opinions on Tepper’s televised remarks, the Dow has since rallied by 7.3%, gold, as measured by the SPDR Gold Trust (GLD) ETF proxy, is up by 8%, and the iShares Barclays Tips Bond Fund (TIP) has gained 3%.
Given Tepper’s astounding 2009 returns, and Appaloosa’s track record of more than 30% average annual gains net of fees since July of 1993, investors will be watching closely when the firm discloses its latest holdings later this month.
A look at Appaloosa’s top-15 U.S.-listed equity holdings from the end of Q2 shows that Tepper was trimming some of his financial holdings in the three months ended June 30. Bank of America (BAC), Citigroup (C), Wells Fargo (WFC), and AIG (AIG) were all subject to some second-quarter selling at Appaloosa, but they remained the fund’s top four equity holdings heading into the second half.
Elsewhere, Tepper beefed up his first-quarter bets on big pharma plays Pfizer (PFE), Merck (MRK), and Johnson & Johnson (JNJ), while opening new positions in department store Macy’s (M) and fertilizer firm CF Industries Holdings (CF) in Q2.
Investors won’t be sure where Tepper stands now until later this month, when the deadline for end-of-Q3 filings hits. At tickerspy.com, members can track Appaloosa’s latest holdings, see a graph of their combined performance, and be notified when the firm’s new holdings are made public.
Pro portfolio performance is based on institutions’ top-15 holdings as disclosed in quarter-end filings with the SEC. Pro performance does not take into account additional holdings beyond the top 15 nor does it include positions that are not required to be disclosed by the SEC. As such, Pro portfolio performance should be considered an approximation and not a precise record of how an institution has performed over time.
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