Hedge Fund Tracking: Timothy Barakett's Atticus Capital, Q3 2008

Next up, we have Atticus Capital. Atticus Capital is a hedge fund run by Timothy Barakett. In 2005, Atticus' funds were up a combined 45% and they finished well over 30% for 2006. Barakett founded the firm at age 26 in 1995 and focuses on taking large, concentrated positions in companies. One of Atticus' most famous investments was Phelps Dodge, a miner which was bought out by Freeport McMoran (FCX). At one point, Atticus owned more than 9% of Phelps. They continue to hold some of their position in what is now the combined FCX.

Barakett received his BA in Economics from Harvard and his MBA from Harvard as well. It's very evident that Barakett employs macro based investment theses. Once he has decided on what the trend is, he will find the best company within that trend and will place a big bet. When needed, he will step in and take an activist role, ensuring the company is performing to his liking.

You may have heard about Atticus over the past few weeks because the company has not been performing well at all this year. In our September hedge fund performance update, we noted that Atticus European was -42.5% for the year as of September, while Atticus Global was -27.2% over the same timeframe. Consequently, Atticus was a victim of liquidation rumors, which were quickly denied.

We previously analyzed Atticus' portfolio holdings back in June and noticed that the company had significant natural resource and mining positions at the time. We'll get into the details below, but you can take a guess as to where a lot of its losses are coming from this year. Overall, it has been one of the worst years for hedge funds in a long time. And although Atticus still exists as a fund, it has definitely had a rough year and has been selling off assets.

The following were Atticus' long equity and options holdings as of September 30th, 2008 as filed with the SEC.

New Positions (Brand new positions that they initiated in the last quarter):
Russell 2000 Index (IWM) Puts
CSX Corp (CSX) Calls
Financial select sector (XLF) Puts


Added to (Positions they already owned but added more shares)
Vale (RIO) Calls
Emisphere Technologies (EMIS)


Reduced Positions (Positions they sold some shares of)
Union Pacific (UNP)
Crown Castle (CCI)
Nyse Euronext (NYX)
Occidental Petroleum (OXY)
Freeport McMoran (FCX)
Gold Fields (GFI)
Freeport McMoran (FCX) Calls
Newmont Mining (NEM)
Western Union (WU)
KT Corp (KTC)
Telekomunikasi Indonesia (TLK)
China Telecom (CHA)
Grupo Aeroportuario del Pacifico (PAC)
Grupo Aeroportuario del Sureste (ASR)
Sunair Services (SNE)
Petrochina (PTR)


Positions with no change
Synvista Therapeutics (SYI)


Removed Positions (Positions they sold out of completely)
Conoco Philips (COP)
Burlington Northern (BNI)
Conseco (CNO)
Peabody (BTU)
Mastercard (MA)
Norfolk Southern (NSC)
Genomic Health (GHDX)
Visa (V)
Focus Media (FMCN)
Nyse Euronext (NYX) Puts
Banco Itau (ITU)
Boeing (BA)
Canadian Natural Resources (CNQ)
Uhaul (UHAL)
Baidu (BIDU)
Banco Bradesco (BBD)
Companhia Saneamento Basico (SBS)
Praxair (PX)
National Financial Partners (NFP)
Unibanco (UBB)
Visa (V) Calls
Conoco Philips (COP) Calls
CSX (CSX)
Clean Energy (CLNE)
General Motors (GM)
BHP (BHP)
XTO Energy (XTO)
Marriott (MAR)
Starwood Hotels (HOT)
Nymex (NMX)
Cisco (CSCO)
Microsoft (MSFT)
American Tower (AMT)
Chesapeake (CHK)
Sandridge (SD)
Monsanto (MON)
Potash (POT)
Research in Motion (RIMM)
Apple (AAPL)
Google (GOOG)


Top 20 Holdings (by % of portfolio)

1. CSX (CSX) Calls
2. Vale (RIO) Calls
3. Freeport McMoran (FCX) Calls
4. Union Pacific (UNP)
5. Financial select sector (XLF) Puts
6. Crown Castle (CCI)
7. Russell 2000 index (IWM) Puts
8. Occidental Petroleum (OXY)
9. NYSE Euronext (NYX)
10. Newmont Mining (NEM)
11. Freeport McMoran (FCX)
12. Telekomunikasi Indonesia (TLK)
13. Western Union (WU)
14. Emisphere Technologies (EMIS)
15. Gold Fields (GFI)
16. China Telecom (CHA)
17. Synvista Therapeutics (SYI)
18. Grupo Aeroportuario del Sureste (ASR)
19. KT Corp (KTC)
20. Grupo Aeroportuario del Pacifico (PAC)

Atticus was definitely out liquidating a lot of assets. In the quarter prior, they had nearly $8 billion in their long equity portfolio. This quarter, they had only around $500 million worth of positions. That is some serious deleveraging and unwinding.

Disclosure: None

Comments

[bowonwing:]

Good find and report. To review Atticus Capital's stock positions as of 9/30/08 report date, go to nasdaq.com; ( you need to search a stock Atticus owes, e.g. EMIS or SYI); then Quotes, Charts, Research; then Institutional Holdings pull down menu; then Institutional Holders separate pull down menu. You will see Atticus Capital as a holder of the stock (in this case EMIS). Click on Atticus Capital and current holdings of report date (here 9/30/08) will fill. This is not complicated and after a few times it will seem easy.
Note from Atticus Capital's 9/30/08 holdings report; Increased Positions: 1; Decreased Positions: 55; Sold Out Positions: 40. Brilliant Q3-2008 moves. JMHO ( I have no connection with Atticus)

2008 Dec 05 01:08 AM