Bloomberg News

Moore Leads Hedge Funds Betting on JPMorgan Before Losses

May 16, 2012

JPMorgan has slumped 21 percent since the end of the first quarter, including an 11 percent decline following the company’s disclosure of losses tied to synthetic credit derivatives. Photographer: Peter Foley/Bloomberg

JPMorgan has slumped 21 percent since the end of the first quarter, including an 11 percent decline following the company’s disclosure of losses tied to synthetic credit derivatives. Photographer: Peter Foley/Bloomberg

Hedge funds Moore Capital Management LLC and Blue Ridge Capital LLC boosted their stakes in JPMorgan Chase & Co. (JPM:US) in the first quarter, while Kingdon Capital Management LLC divested, before the shares plunged because of a $2 billion trading loss.

Moore, the $15 billion fund in New York run by Louis Moore Bacon, bought 6 million shares of JPMorgan, making the $297.3 million stake its largest U.S. stock holding as of March 31, according to a filing yesterday with the Securities and Exchange Commission. John Griffin’s New York-based Blue Ridge purchased 1.85 million shares, raising its stake in the bank to 6.14 million.

JPMorgan has slumped 21 percent since the end of the first quarter, including an 11 percent decline following the company’s May 10 disclosure of losses tied to synthetic credit derivatives. Chief Executive Officer Jamie Dimon said the New York-based bank made “egregious mistakes.”

Federal regulators are examining what happened, including the SEC and Commodity Futures Trading Commission, according to people familiar with the probes. The U.S. Justice Department and Federal Bureau of Investigation in New York have also begun a criminal probe, a person familiar with the matter said yesterday.

Omega Advisors Inc., Leon Cooperman’s New York hedge fund, bought 1.34 million shares of JPMorgan, raising its stake (JPM:US) in the bank to 2.22 million, according to a May 14 filing. Tudor Investment Corp., the $11.1 billion hedge fund run by Paul Tudor Jones in Greenwich, Connecticut, purchased 1.27 million shares, making the bank its second-largest equity position, according to a filing yesterday.

JPMorgan was the second-most purchased U.S. stock by hedge funds in the first quarter after Medco Health Solutions Inc., according to data compiled by Bloomberg. Citigroup Inc., based in New York, was the fifth-most purchased stock.

JPMorgan was the fourth-largest stock holding among hedge funds after technology firms Apple Inc., Google Inc. and Microsoft Corp., the data show.

Soros, Singh

Billionaire George Soros’s New York-based investment firm, Soros Fund Management LLC, bought 606,400 JPMorgan shares in the quarter, according to a filing yesterday. TPG-Axon Capital Management LP, Dinakar Singh’s hedge fund in New York, added 520,000 shares, bringing its holding to 3.13 million.

Odey Asset Management LLP, the London-based hedge fund founded by Crispin Odey, added almost 148,000 JPMorgan shares, increasing its position to 2.39 million, according to a filing.

Other funds that boosted to their stakes in the first quarter include Adage Capital Management LP in Boston, Caxton Associates LP in New York and AQR Capital Management LLC in Greenwich, Connecticut.

Hedge funds that cut their JPMorgan holdings include London-based Lansdowne Partners LP, which sold almost 6.6 million shares, leaving it with 17.5 million, according to a filing.

Maverick Capital Management LP, Lee Ainslie’s fund that has offices in Dallas and New York, reported selling 3.7 million shares of the bank, leaving it about 4.7 million. Eminence Capital LLC, based in New York, also cut its stake.

Kingdon Capital, run by Mark Kingdon in New York, sold its entire position of 2 million shares, according to a filing.

To contact the reporter on this story: Saijel Kishan in New York at skishan@bloomberg.net

To contact the editor responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net


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Companies Mentioned

  • JPM
    (JPMorgan Chase & Co)
    • $59.0 USD
    • 0.33
    • 0.56%
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