We lead the herd. The Street follows us, we don't follow the Street. - David Tepper
We're consistently inconsistent. It's one of the cornerstones of our success. - David Tepper
According to a Q3 13 F filed by Appaloosa Management, David Tepper's biggest new position is in the shares of American International Group, Inc (NYSE: AIG). The fund manager known for his gutsy calls picked up 8.25 million shares (currently valued at $270 million), which accounts for about 6.73% of the fund's long stock portfolio.
Mr. Tepper is the latest mega hedge-fund manager - his funds have averaged about 30% net since 1992 and his AUM towers around $15 billion - to join a growing roster of hedge funds having a significant holding in AIG.
Recently, we pointed out that Daniel Loeb of Third Point (as per his third quarter Letter to Shareholders) has added to the AIG position to the point where it has become the fund's second largest holding.
In the letter, Mr. Loeb states that initially his thesis was short-term oriented and technically driven primarily by the fact that the US Government was "forced" to sell some shares as soon as it could get out profitably, thereby creating an opportunity for Third Point to buy the shares directly at an intrinsic discount. Now, though, Mr. Loeb perceives the AIG opportunity as a "post-reorg equity newly emerged, with all of the attendant upside". The fund continues to buy from treasury sales and the stock market, and has shifted its strategy from a short-term trade to a long term hold.
The names of the hedge funds that are now holding AIG is long, diverse (in strategies) and impressive - George Soros, Blue Ridge Capital, Glenview Capital Management, Marathon Asset Management, Silver Point Capital, and Omega Advisors, to name just a few.
Here are some numbers to highlight the conviction level of the hedge fund managers on this stock. John Griffin's Blue Ridge Capital and Larry Robbins' Glenview Capital each hold more than $250 million representing 5% of their assets. Silver Point Capital now owns $150 million worth of AIG and the position commands 20% of its assets. Marathon Asset Management reported ownership of more than $230 million and Leon Cooperman's (Omega Advisors) stake is close to $150 million.
Bruce Berkowitz of Fairholme Funds tops the list, though, with a holding amounting to $2.8 billion and representing a whopping 40% of his AUM.