George Soros and John Paulson are at different stages of their career, however their deeds that lead to their fame during financial crises were similar – both made a lot of money at the expenses of the counterparts of their trades.
Soros was known as "the man who broke the Bank of England". On September 16, 1992 (later on it was known as “Black Wednesday”), Soros's fund sold short more than $10 billion worth of British pounds, betting on the Bank of England's reluctance to either raise its interest rates to levels comparable to those of other European Exchange Rate Mechanism countries or to float its currency. Finally, the Bank of England withdrew the currency from the European Exchange Rate Mechanism and devaluated British Pound. Soros earned an estimated US$ 1.1 billion in the process.
Fast forward to 2007-2008 financial crisis, in which Paulson made “the greatest trade ever”. Paulson correctly bet against subprime mortgages and then, ultimately, the companies that were backing and insuring them. He constructed his trades by buying CDS contracts, which are basically insurance policies on debt. In 2007 alone he made $15 billion for his firm.
All crises have to come to an end but their careers do not end. So on a typical peaceful day, they buy and sell stocks just like the rest of us. GuruFocus tracks their long equity positions through their SEC filings. They are not required to report their short and other exotic positions, so we have simply wait for our chance to read about those when and if the gains (or losses) became so out of proportion that someone will write a book about them.
The two managers trade stocks differently: Soros is an outright speculator, capturing profits (sometimes losses) from the trends that he recognizes at the time. Paulson, on the other hand, could be classified as an investor as he does assess the worthiness of the individual issues and buy-and-hold for a longer period of time. Before Paulson became the Paulson, he was known for risk arbitraging on M&A deals – an art he still performs from time to time. With the newly found wealth in the greatest trade, it is increasingly hard for him to find deals in which he can deploy billions of dollars.
As of March 31, 2010, the latest date for which data is available, Soros, through Soros Fund Management, owns $6.73 billion in 821 stocks; Paulson, $21.15 billion in 59 stocks. You can click on their names to see the detailed holdings of each.
While we are at the topic of their stock holdings, I became curious: what stock ideas do the two greatest traders of our times share? GuruFocus has this cool tool called “Aggregated Guru Portofolio” which yield answer to that question easily. Apply the tool on Soros and Paulson and I am surprised by how many stocks they own in common: of the 59 stocks that Paulson owns on March 31, 31 of them are also owned by Soros. In other word, more than half of the stocks that Paulson has, Soros also owns.
Granted, the two stand differently on the 31 stocks. They could be buying, holding or selling some of the names during the quarter. The Aggregated Guru Portofolio tool provides information on how many gurus are buying or selling during the latest quarter too. As a demonstration, here is the list of stocks that both Soros and Paulson have been buying during the first quarter of this year:
And a brief review of the stocks:
NovaGold Resources Inc (NG, Financial)
NovaGold Resources is a gold and copper company engaged in the exploration and development of mineral properties in Alaska and Western Canada. Novagold Resources Inc has a market cap of $1.4 billion; its shares were traded at around $6.33 with and P/S ratio of 998.5.
Paulson bought 20,181,818 shares in the quarter that ended on 03/31/2010, which is 0.68% of the $21.15 billion portfolio of Paulson & Co.. Soros owns 18,700,164 shares as of 03/31/2010, an increase of 435.82% from the previous quarter. This position accounts for 1.98% of the $6.73 billion portfolio of Soros Fund Management LLC.
Kinross Gold Corp. (KGC, Financial)
Kinross Gold Corporation is an entrepreneurial mining company which has become a million-ounce gold producer. Kinross Gold Corp. has a market cap of $11.47 billion; its shares were traded at around $16.33 with a P/E ratio of 34.7 and P/S ratio of 4.7. The dividend yield of Kinross Gold Corp. stocks is 0.7%. Kinross Gold Corp. had an annual average earning growth of 7% over the past 10 years.
Soros owns 3,863,600 shares as of 03/31/2010, an increase of 39.13% from the previous quarter. This position accounts for 0.98% of the $6.73 billion portfolio of Soros Fund Management LLC. Paulson owns 33,140,000 shares as of 03/31/2010, which accounts for 2.68% of the $21.15 billion portfolio of Paulson & Co
IAMGOLD Corp. (IAG, Financial)
IAMGOLD Corp is an international gold exploration and mining company based in Canada. Iamgold Corp. has a market cap of $6.11 billion; its shares were traded at around $16.44 with a P/E ratio of 27.9 and P/S ratio of 6.7. The dividend yield of Iamgold Corp. stocks is 0.4%. Iamgold Corp. had an annual average earning growth of 9.3% over the past 5 years.
Paulson bought 2,700,000 shares in the quarter that ended on 03/31/2010, which is 0.17% of the $21.15 billion portfolio of Paulson & Co.. Soros bought 199,150 shares in the quarter that ended on 03/31/2010, which is 0.04% of the $6.73 billion portfolio of Soros Fund Management LLC.
Devon Energy Corp. (DVN, Financial)
Devon Energy Corporation is an independent energy company engaged primarily in oil and gas exploration, development and production, and in the acquisition of producing properties. Devon Energy Corp. has a market cap of $28.5 billion; its shares were traded at around $63.78 with a P/E ratio of 11.8 and P/S ratio of 3.6. The dividend yield of Devon Energy Corp. stocks is 1.1%.
Paulson bought 3,300,000 shares in the quarter that ended on 03/31/2010, which is 1.01% of the $21.15 billion portfolio of Paulson & Co.. Soros bought 23,500 shares in the quarter that ended on 03/31/2010, which is 0.02% of the $6.73 billion portfolio of Soros Fund Management LLC.
AngloGold Ashanti Ltd. (AU, Financial)
AngloGold Limited is the largest gold producer at 7 million ounces a year, with reserves of 126 m oz. Anglogold Ashanti Ltd. has a market cap of $15.64 billion; its shares were traded at around $40.02 with a P/E ratio of 15.2 and P/S ratio of 4. The dividend yield of Anglogold Ashanti Ltd. stocks is 0.4%.
Soros bought 58,060 shares in the quarter that ended on 03/31/2010, which is 0.03% of the $6.73 billion portfolio of Soros Fund Management LLC. Paulson owns 43,749,864 shares as of 03/31/2010, which accounts for 7.85% of the $21.15 billion portfolio of Paulson & Co..
Apollo Group Inc. (APOL, Financial)
Apollo Group, Inc. has been providing higher education to working adults for over 25 years. Apollo Group Inc. has a market cap of $7 billion; its shares were traded at around $46.32 with a P/E ratio of 9 and P/S ratio of 1.8. Apollo Group Inc. had an annual average earning growth of 26.4% over the past 10 years. GuruFocus rated Apollo Group Inc. the business predictability rank of 4-star.
Soros owns 27,500 shares as of 03/31/2010, an increase of 281.94% from the previous quarter. This position accounts for 0.03% of the $6.73 billion portfolio of Soros Fund Management LLC. Paulson owns 1,600,000 shares as of 03/31/2010, an increase of 93% from the previous quarter. This position accounts for 0.46% of the $21.15 billion portfolio of Paulson & Co..
Barrick Gold Corp. (ABX, Financial)
Barrick Gold Corporation is a international gold producer with low-cost mines in North and South America. Barrick Gold Corp. has a market cap of $41.6 billion; its shares were traded at around $42.23 with a P/E ratio of 17.9 and P/S ratio of 5.2. The dividend yield of Barrick Gold Corp. stocks is 1%. Barrick Gold Corp. had an annual average earning growth of 14.2% over the past 10 years.
Paulson bought 400,000 shares in the quarter that ended on 03/31/2010, which is 0.07% of the $21.15 billion portfolio of Paulson & Co.. Soros owns 99,540 shares as of 03/31/2010, an increase of 443.93% from the previous quarter. This position accounts for 0.06% of the $6.73 billion portfolio of Soros Fund Management LLC.
Conclusion
Both Soros and Paulson have had a good appetite for gold mining companies as they each bought shares in these companies in the first quarter of this year. Given the track records of the two betting correctly on mega-trends, I would not write off the fact easily.
Stay tuned for the next time when we update their holdings in about three weeks.
GuruFocus provides real time information and insights of Investment Gurus such as George Soros and John Paulson for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
Soros was known as "the man who broke the Bank of England". On September 16, 1992 (later on it was known as “Black Wednesday”), Soros's fund sold short more than $10 billion worth of British pounds, betting on the Bank of England's reluctance to either raise its interest rates to levels comparable to those of other European Exchange Rate Mechanism countries or to float its currency. Finally, the Bank of England withdrew the currency from the European Exchange Rate Mechanism and devaluated British Pound. Soros earned an estimated US$ 1.1 billion in the process.
Fast forward to 2007-2008 financial crisis, in which Paulson made “the greatest trade ever”. Paulson correctly bet against subprime mortgages and then, ultimately, the companies that were backing and insuring them. He constructed his trades by buying CDS contracts, which are basically insurance policies on debt. In 2007 alone he made $15 billion for his firm.
All crises have to come to an end but their careers do not end. So on a typical peaceful day, they buy and sell stocks just like the rest of us. GuruFocus tracks their long equity positions through their SEC filings. They are not required to report their short and other exotic positions, so we have simply wait for our chance to read about those when and if the gains (or losses) became so out of proportion that someone will write a book about them.
The two managers trade stocks differently: Soros is an outright speculator, capturing profits (sometimes losses) from the trends that he recognizes at the time. Paulson, on the other hand, could be classified as an investor as he does assess the worthiness of the individual issues and buy-and-hold for a longer period of time. Before Paulson became the Paulson, he was known for risk arbitraging on M&A deals – an art he still performs from time to time. With the newly found wealth in the greatest trade, it is increasingly hard for him to find deals in which he can deploy billions of dollars.
As of March 31, 2010, the latest date for which data is available, Soros, through Soros Fund Management, owns $6.73 billion in 821 stocks; Paulson, $21.15 billion in 59 stocks. You can click on their names to see the detailed holdings of each.
While we are at the topic of their stock holdings, I became curious: what stock ideas do the two greatest traders of our times share? GuruFocus has this cool tool called “Aggregated Guru Portofolio” which yield answer to that question easily. Apply the tool on Soros and Paulson and I am surprised by how many stocks they own in common: of the 59 stocks that Paulson owns on March 31, 31 of them are also owned by Soros. In other word, more than half of the stocks that Paulson has, Soros also owns.
Granted, the two stand differently on the 31 stocks. They could be buying, holding or selling some of the names during the quarter. The Aggregated Guru Portofolio tool provides information on how many gurus are buying or selling during the latest quarter too. As a demonstration, here is the list of stocks that both Soros and Paulson have been buying during the first quarter of this year:
And a brief review of the stocks:
NovaGold Resources Inc (NG, Financial)
NovaGold Resources is a gold and copper company engaged in the exploration and development of mineral properties in Alaska and Western Canada. Novagold Resources Inc has a market cap of $1.4 billion; its shares were traded at around $6.33 with and P/S ratio of 998.5.
Paulson bought 20,181,818 shares in the quarter that ended on 03/31/2010, which is 0.68% of the $21.15 billion portfolio of Paulson & Co.. Soros owns 18,700,164 shares as of 03/31/2010, an increase of 435.82% from the previous quarter. This position accounts for 1.98% of the $6.73 billion portfolio of Soros Fund Management LLC.
Kinross Gold Corp. (KGC, Financial)
Kinross Gold Corporation is an entrepreneurial mining company which has become a million-ounce gold producer. Kinross Gold Corp. has a market cap of $11.47 billion; its shares were traded at around $16.33 with a P/E ratio of 34.7 and P/S ratio of 4.7. The dividend yield of Kinross Gold Corp. stocks is 0.7%. Kinross Gold Corp. had an annual average earning growth of 7% over the past 10 years.
Soros owns 3,863,600 shares as of 03/31/2010, an increase of 39.13% from the previous quarter. This position accounts for 0.98% of the $6.73 billion portfolio of Soros Fund Management LLC. Paulson owns 33,140,000 shares as of 03/31/2010, which accounts for 2.68% of the $21.15 billion portfolio of Paulson & Co
IAMGOLD Corp. (IAG, Financial)
IAMGOLD Corp is an international gold exploration and mining company based in Canada. Iamgold Corp. has a market cap of $6.11 billion; its shares were traded at around $16.44 with a P/E ratio of 27.9 and P/S ratio of 6.7. The dividend yield of Iamgold Corp. stocks is 0.4%. Iamgold Corp. had an annual average earning growth of 9.3% over the past 5 years.
Paulson bought 2,700,000 shares in the quarter that ended on 03/31/2010, which is 0.17% of the $21.15 billion portfolio of Paulson & Co.. Soros bought 199,150 shares in the quarter that ended on 03/31/2010, which is 0.04% of the $6.73 billion portfolio of Soros Fund Management LLC.
Devon Energy Corp. (DVN, Financial)
Devon Energy Corporation is an independent energy company engaged primarily in oil and gas exploration, development and production, and in the acquisition of producing properties. Devon Energy Corp. has a market cap of $28.5 billion; its shares were traded at around $63.78 with a P/E ratio of 11.8 and P/S ratio of 3.6. The dividend yield of Devon Energy Corp. stocks is 1.1%.
Paulson bought 3,300,000 shares in the quarter that ended on 03/31/2010, which is 1.01% of the $21.15 billion portfolio of Paulson & Co.. Soros bought 23,500 shares in the quarter that ended on 03/31/2010, which is 0.02% of the $6.73 billion portfolio of Soros Fund Management LLC.
AngloGold Ashanti Ltd. (AU, Financial)
AngloGold Limited is the largest gold producer at 7 million ounces a year, with reserves of 126 m oz. Anglogold Ashanti Ltd. has a market cap of $15.64 billion; its shares were traded at around $40.02 with a P/E ratio of 15.2 and P/S ratio of 4. The dividend yield of Anglogold Ashanti Ltd. stocks is 0.4%.
Soros bought 58,060 shares in the quarter that ended on 03/31/2010, which is 0.03% of the $6.73 billion portfolio of Soros Fund Management LLC. Paulson owns 43,749,864 shares as of 03/31/2010, which accounts for 7.85% of the $21.15 billion portfolio of Paulson & Co..
Apollo Group Inc. (APOL, Financial)
Apollo Group, Inc. has been providing higher education to working adults for over 25 years. Apollo Group Inc. has a market cap of $7 billion; its shares were traded at around $46.32 with a P/E ratio of 9 and P/S ratio of 1.8. Apollo Group Inc. had an annual average earning growth of 26.4% over the past 10 years. GuruFocus rated Apollo Group Inc. the business predictability rank of 4-star.
Soros owns 27,500 shares as of 03/31/2010, an increase of 281.94% from the previous quarter. This position accounts for 0.03% of the $6.73 billion portfolio of Soros Fund Management LLC. Paulson owns 1,600,000 shares as of 03/31/2010, an increase of 93% from the previous quarter. This position accounts for 0.46% of the $21.15 billion portfolio of Paulson & Co..
Barrick Gold Corp. (ABX, Financial)
Barrick Gold Corporation is a international gold producer with low-cost mines in North and South America. Barrick Gold Corp. has a market cap of $41.6 billion; its shares were traded at around $42.23 with a P/E ratio of 17.9 and P/S ratio of 5.2. The dividend yield of Barrick Gold Corp. stocks is 1%. Barrick Gold Corp. had an annual average earning growth of 14.2% over the past 10 years.
Paulson bought 400,000 shares in the quarter that ended on 03/31/2010, which is 0.07% of the $21.15 billion portfolio of Paulson & Co.. Soros owns 99,540 shares as of 03/31/2010, an increase of 443.93% from the previous quarter. This position accounts for 0.06% of the $6.73 billion portfolio of Soros Fund Management LLC.
Conclusion
Both Soros and Paulson have had a good appetite for gold mining companies as they each bought shares in these companies in the first quarter of this year. Given the track records of the two betting correctly on mega-trends, I would not write off the fact easily.
Stay tuned for the next time when we update their holdings in about three weeks.
GuruFocus provides real time information and insights of Investment Gurus such as George Soros and John Paulson for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
