Bloomberg News

Tudor Sells Microsoft, Wagers Technology Companies to Decline

November 15, 2011

Nov. 15 (Bloomberg) -- Tudor Investment Corp., the hedge fund founded by Paul Tudor Jones, cut its stakes in Microsoft Corp., Apple Inc. and Google Inc. in the third quarter, while purchasing options that will pay off if an index tracking U.S. technology companies declines in value.

Tudor sold 1 million shares of Microsoft to reduce its stake to 160,300 shares valued at $3.99 million in the three months ended Sept. 30, according to a filing today with the U.S. Securities and Exchange Commission. Tudor, based in Greenwich, Connecticut, reduced its Apple holdings by 78 percent to 5,600 shares and cut shares of Google by 38 percent to 33,711 shares, according to the filing.

Options traders have become the most bearish on technology companies since May 2010 amid concern the global economy is slowing and that floods in Thailand will disrupt supplies ahead of the holiday shopping season. Three-month puts to sell the Technology Select Sector SPDR Fund cost 11.29 points more than calls to buy, according to data compiled by Bloomberg.

In the third quarter, Tudor bought put options tied to 12.3 million shares of the Powershares QQQ Nasdaq 100, according to the SEC filing. The notional value of the trade is $643 million, according to the filing. The Powershares QQQ is an exchange- traded fund designed to track the performance of the 100 largest companies listed on the Nasdaq Stock Market.

Apple, the world’s largest technology company by market value, fell 3.9 percent last week on investor concerns that demand for iPads and iPhones is slowing.

--Editors: Steven Crabill, Christian Baumgaertel

To contact the reporter on this story: Jesse Westbrook in London at jwestbrook1@bloomberg.net

To contact the editors responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net; Edward Evans at eevans3@bloomberg.net


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