Wednesday, 30 July 2014
Last updated 9 hours ago
Aug 16 2012 | 11:39am ET
Hedge funds fled from JPMorgan Chase shares in the second quarter, dumping the stock in the wake of a damaging trading scandal that has cost the bank billions. But the turn against JPMorgan came amidst something of a buying spree for hedge funds among other financials.
The JPMorgan sell-off was led by Moore Capital Management, which dumped all of its 6.47 million shares of the bank. TPG-Axon Management also quit the stock.
Other hedge funds seriously trimmed their stakes, including Highfields Capital Management, Omega Advisors, Owl Creek Asset Management and Soros Fund Management. And Paulson & Co. cut back on its JPMorgan warrants on the quarter.
Meanwhile, other hedge funds were buying up other bank shares. BlueMountain Capital Management opened a new position in Citigroup and boosted its stake Flagstar Bancorp. Kynikos Associates boosted its holdings of Citi, and Eton Park Capital Management said it has the right to buy up 21.5 million Morgan Stanley shares and 12.7 million Citi shares.
In addition, Baupost Group and Greenlight Capital opened positions in insurer Genworth Financials.
Some hedge funds even sought to take advantage of the huge drop in JPMorgan shares, despite the months of uncertainty ahead. BlueMountain, Kynikos and Odey boosted their stakes in the bank, as did Capital Growth Management.
Nor was every other bank the apple of every hedge funds' eye. Moore ditched positions in U.S. Bancorp and Wells Fargo. Pershing Square Capital Management and Viking Global Advisors abandon or cut stakes in Citi, while Appaloosa Management and Omega sold off Bank of America.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…