Q2 13Fs were released last Friday, and as always, they include a treasure trove of valuable information.
Examining 13F filings is very useful for a number of different reasons. In particular, they're a great place for small investors to generate stock ideas. If for example, you notice a number of prominent and successful hedge funds own the same stock, it's a safe bet that it could be a name to take a closer look at.
Another way of using the quarterly 13F filings is to track the changes in the portfolios of top hedge fund managers. This is valuable information because it allows smaller investors a glimpse into the inner workings of the top hedge funds in the world.
These 13F filings can also shed light on the thinking of top managers along with the strategies that they are using to rack up consistently stellar returns.
With this in mind, Benzinga will be covering a variety of prominent funds' 13F filings this week with an eye towards finding compelling ideas and themes buried in hedge fund portfolios.
Tiger Global Management
Kicking things off is Chase Coleman's Tiger Global Management. In addition to the hedge fund's consistently strong track record, Tiger Global has also had a couple of years where it posted astronomical performance figures given its size. In 2011, for example, the fund surged 45 percent in the first 10 months of the year.
Coleman, who is just 40 years old, got his start under famed investor Julian Robertson, founder of the legendary Tiger Management hedge fund. Robertson was known for taking a bottom-up, kick-the-tires approach to stock picking that emphasized deep fundamental research. It's safe to say this strategy probably rubbed off on Coleman. Tiger Global, however, has made a name for itself by investing in Internet and technology stocks such as Facebook Inc FB, LinkedIn LNKD and Priceline Group Inc PCLN.
In fact, the fund has been so successful in this arena that it now has its own venture capital arm which accounts for a significant portion of its returns. This type of investing, however, also can lead to significant volatility, which stung Tiger Global in Q1 2016 after posting a gain of 6.8 percent in 2015. Bloomberg reported the $6 billion hedge fund plunged 22 percent during the first three months of the year.
The firm's most recent 13F filing revealed that it sold out of its massive position in Netflix, Inc. NFLX sometime between the first and second quarters. According to Tiger Global's Q2 filing, the hedge fund ditched all 18 million Netflix shares, which were valued at over $1.8 billion at the end of the first quarter. The fund had initiated its Netflix position sometime in Q4 2014 and then added substantially to it during Q2 2015. The stock is up sharply from late 2014, when shares were trading for under $50.
Depending on exactly when Tiger Global added to the position in Q2 2015, the fund likely only made a small profit on the additional purchases. Netflix is currently trading at around $95.00, well off of its 52-week high above $133.00.
The other notable development in the quarter was that Tiger Global trimmed its Apple Inc AAPL stake by selling 4.2 million shares. The fund was still showing a stake of a little less than 1.4 million Apple shares in its most recent 13F filing.
Little else changed in the Tiger Global portfolio between the first and second quarters, and the fund is still heavily concentrated in a handful of prominent tech stocks. These include Amazon.com, Inc. AMZN, Charter Communications Inc CHTR, JD.Com Inc JD, which is kind of like the Amazon of China, and Priceline Group Inc PCLN. The size of these stakes ranged from a $934 million market value for JD.Com to just over $1 billion for the Amazon position.
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