(GuruFocus, December 21, 2009) Investment Guru David Tepper is credited for making this year about $7 billion for his firm and about $2 billion for himself in this Christian Science Monitor article entitle David Tepper and Co.: Which traders profitedmost from the downturn?
The article compared Tepper’s gain to the phenomenal profits that Jim Simons, John Paulson, and John Arnold made during the immediate past crisis. David Tepper made this year’s gain by scooping up the unwanted financials such as Bank of America (BAC, Financial) shares at around $3 per share. Nowadays, the stock is dangling around 15.
According to GuruFocus data, David Tepper bought 47.5 million shares of in BAC in 1Q09. He sold a tiny bit in 2Q09, bringing the shares held to 46.8 million shares; in 3Q09, he sold down to 33.8 million shares. GuruFocus users will be among the first ones to know what he did with the shares during 4Q09.
Just when you might think that he was done with large bank Financials, he entered a large position in Citigroup (C, Financial) in 3Q09. GuruFocus data shows that he owns almost 80 million shares of Citigroup Inc. as of September 30, 2009. During the third quarter of this year, Citigroup stocks were traded between $2.59 and $5.23, with an average of $3.85. Today’s close of $3.42 is at the lower end of that range. In other words, investors could pick up some shares in Citigroup at lower prices than David Tepper.
Very typical to David Tepper, he makes heavy bets on one or two sectors at a time. GuruFocus data shows him held 68.2% of his equity portfolio in Oil & Gas in 2Q08; by 4Q08, he sold all the way down to 10% in Oil in Gas.
In the meantime, Financials accounts for only 0.3% as of 2Q08; by 4Q08, he owns 45.6% of his equities in Financials. The Financial stock weighting stands at 68.1% as of September 30, 2009.
Technology is another area we saw a large swing. In 1Q08, he owns 67.6 % in technology issues, but by the next quarter, 2Q08, the weighting is down to 11.7%. Today it stands at 3%.
Tepper’s sector concentrated investment strategy may not work all the time. But when it does, he makes a large profit. Since the founding of his firm, he managed to return triple digits three times, 1996, 2003, and 2009 YTD, according to this profile in Forbes.com, which ranked him as No.97 Richest American on September 30, 2009.
As a side note, the Christian Science Monitor article disclosed that David Tepper set his eyes now on the next big prize: commercial mortgage-backed securities. Anyone knows how retail investor can construct a trade by longing those securities?
Please share if you know.
GuruFocus provides real time information and insights of Investment Gurus such as Warren Buffett and David Tepper for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
The article compared Tepper’s gain to the phenomenal profits that Jim Simons, John Paulson, and John Arnold made during the immediate past crisis. David Tepper made this year’s gain by scooping up the unwanted financials such as Bank of America (BAC, Financial) shares at around $3 per share. Nowadays, the stock is dangling around 15.
According to GuruFocus data, David Tepper bought 47.5 million shares of in BAC in 1Q09. He sold a tiny bit in 2Q09, bringing the shares held to 46.8 million shares; in 3Q09, he sold down to 33.8 million shares. GuruFocus users will be among the first ones to know what he did with the shares during 4Q09.
Just when you might think that he was done with large bank Financials, he entered a large position in Citigroup (C, Financial) in 3Q09. GuruFocus data shows that he owns almost 80 million shares of Citigroup Inc. as of September 30, 2009. During the third quarter of this year, Citigroup stocks were traded between $2.59 and $5.23, with an average of $3.85. Today’s close of $3.42 is at the lower end of that range. In other words, investors could pick up some shares in Citigroup at lower prices than David Tepper.
Very typical to David Tepper, he makes heavy bets on one or two sectors at a time. GuruFocus data shows him held 68.2% of his equity portfolio in Oil & Gas in 2Q08; by 4Q08, he sold all the way down to 10% in Oil in Gas.
In the meantime, Financials accounts for only 0.3% as of 2Q08; by 4Q08, he owns 45.6% of his equities in Financials. The Financial stock weighting stands at 68.1% as of September 30, 2009.
Technology is another area we saw a large swing. In 1Q08, he owns 67.6 % in technology issues, but by the next quarter, 2Q08, the weighting is down to 11.7%. Today it stands at 3%.
Tepper’s sector concentrated investment strategy may not work all the time. But when it does, he makes a large profit. Since the founding of his firm, he managed to return triple digits three times, 1996, 2003, and 2009 YTD, according to this profile in Forbes.com, which ranked him as No.97 Richest American on September 30, 2009.
As a side note, the Christian Science Monitor article disclosed that David Tepper set his eyes now on the next big prize: commercial mortgage-backed securities. Anyone knows how retail investor can construct a trade by longing those securities?
Please share if you know.
GuruFocus provides real time information and insights of Investment Gurus such as Warren Buffett and David Tepper for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
