Appaloosa Powers Up As Sector Powers Down

Aug 25 2008 | 1:00am ET

Appaloosa Management’s timing could not have been worse.

The Chatham, N.J., hedge fund, run by former Goldman Sachs trader David Tepper, rushed into energy stocks just in time to seem them fall through the floor. The fund bought a whopping $2.4 billion in oil and gas stocks in the second quarter, boosting its allocation to the sector to 79% of U.S. equity holdings from less than 1%, according to a filing with the Securities and Exchange Commission.

Unfortunately for Tepper and his investors, oil prices have taken a beating in recent weeks, dragging down the whole energy sector. According to Bloomberg News, the value of Appaloosa’s holdings has fallen 14% in July and August.

Among the 18 names Appaloosa entered last quarter are Chevron Corp., ConocoPhillips and Devon Energy Corp. The fund also increased its holdings of the Energy Select Sector SPDR exchange-traded fund.


In Depth

U.S. Treasury Moves on Reinsurance Loophole

Apr 24 2015 | 5:11pm ET

The U.S. Treasury Department has released proposed rules aimed at limiting the ability...

Lifestyle

Puerto Rico Woos The Rich But So Far Gains Little

Apr 17 2015 | 2:45am ET

Hedge fund manager Rob Rill grins. He has just had word that U.S. financial regulators...

Guest Contributor

Opportunities Ahead: Asian Fixed Income and Currency Markets

Apr 24 2015 | 6:18am ET

For hedge funds focusing on Asia, the policy uncertainty, unclear interest rate...

 

Editor's Note