Third Point Said To Gain 4.6% In Q2, Add Alibaba And BlackRock To Portfolio

Jul 26 2017 | 9:32pm ET

Dan Loeb’s Third Point hedge fund reportedly rose 4.6% in the second quarter, driving a solid 10.7% return in the first half of 2017 and placing it among the few managers that beat a racing S&P 500 Index’s 8.3% gain.

The famed investment manager renewed his wager on Chinese e-commerce giant Alibaba in the second quarter, according to a Reuters article citing an investor letter. In the letter, Loeb reportedly described Alibaba as one of the best business models in the global internet sector and predicted it will benefit significantly from recent modifications to its ad platform. 

Loeb’s letter reiterated his shift towards international investments, Reuters added, noting that European equity exposure is at its highest level since 2010 and citing the fund’s recent investment in Swiss food conglomerate Nestle. Third Point also trimmed banking sector positions and exited reflationary macro trades, the article continued, while placing a new bet on asset management giant BlackRock. With $5.7 trillion in AUM, part of Loeb’s these is that BlackRock’s dominance in lower-cost investment products like ETFs will be increasingly valuable as investors flock to cheaper, more passive investment alternatives. 

Third Point’s second quarter letter highlighted gains in Baxter International, Nestle SA, Constellation Brands, auction house Sotheby's and Honeywell International, the article said. Meanwhile, losers included JPMorgan Chase & Co and T-Mobile US Inc.

Loeb’s letter also announced that Third Point will close to new capital from new investors on October 1. Rarely open to new money, the fund reopened in mid-2016 for the first time since raising $2.5 billion in 2014. 

New York-based Third Point is a multi-strategy alternative asset manager founded in 1995 by Loeb. It manages approximately $16.5 billion and focuses on even-driven, value-oriented investing, but is well-known for taking activist positions in large companies. 

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