Soros Opens Position in Plains Exploration

George Soros' hedge fund Soros Fund Management has disclosed a new position in Plains Exploration (PXP). In a 13G filed with the SEC, Soros Fund Management now shows a 5.38% ownership stake in PXP due to activity on April 21st, 2009. They now own 6,467,400 shares. Again, this is a new holding for Soros Fund Management, as they previously did not hold it when we last looked at Soros' portfolio.

Their last disclosure unveiled positions held as of December 31st, 2008. PXP was nowhere to be found on that filing, but it will obviously be present on the next round of disclosures. Soros' next 13F filing disclosing his entire long portfolio will be available in the next two weeks or so and we'll be covering all the activity as always. This new position in PXP comes right after we just learned that Soros had updated his position in Mercury Computer (MRCY).

Soros is famous for his stellar returns with partner Jim Rogers when they ran their (now defuntct) Quantum fund. (We recently covered Jim Rogers' portfolio here). Whether it be equities, bonds, currencies, debt, or commodities, Soros' fund is more of a global macro player, seeking investments in whatever market it can gain an edge. Soros' vast experience is evident with his appearance on Forbes' billionaire list, as well as on the top 25 highest paid hedge fund managers.

Recently, Soros detailed his thoughts about his portfolio from 2008 and it makes for a good read. His fund finished '08 up 8% as noted in our hedge fund year end performances post. His success in 2008 came from making correct bets on the US dollar and betting that short term interest rates in the UK would decline. Interestingly enough, Soros was down for much of the year, until he fought his way back with overtrading. And, as such, Soros Fund Management is now ranked #8 in the 2009 hedge fund rankings.

Additional thoughts from Soros on the current financial landscape are detailed in his latest book, The New Paradigm for Financial Markets: The Credit Crisis of 2008 and What It Means. Soros sees a vast consolidation in the hedge fund space in the near future. If you want to get a better sense as to how Soros formulates his investment theses, we highly recommend reading his first book, The Alchemy of Finance. This book is a staple in our recommended reading list and after you read it, you'll understand why.

Taken from Google Finance:

Plains Exploration is "an independent oil and gas company primarily engaged in the activities of acquiring, developing, exploring and producing oil and gas properties primarily in the United States. The Company owns oil and gas properties with principal operations in Onshore California; Offshore California; the Gulf of Mexico; the Gulf Coast Region; the Mid-Continent Region, and the Rocky Mountains. As of December 31, 2008, the Company had estimated proved reserves of 292.1 million barrels of oil equivalent, of which 61% was comprised of oil and 72% was proved developed."

Comments

[kelm:]

Interesting. Certainly there has been a huge scaling back of oil and gas exploration and development in response to the crisis and that will drive prices substantially higher when the global economy truly revives.

May 05 09:20 AM

[Ferdinand E...:]

Hmm. Unless I am mistaken, this venture will work as follows. Some exploration and production will probably take place, and on the basis of that and Mr Soros' celebrity and reputation, share prices will escalate. Eventually those prices will be high enough for Mr Soros and colleagues to leave the table. If there was a sizable amount of oil in the places mentioned, Big Oil would be a major player.

May 05 09:50 AM

[johnmorrison9:]

Sorass is a titanic villian, and Obama is his puppet!

May 05 10:03 AM

[joes:]

George Soros is no villian, he has done more to expand democracy and capitalism than anyone over the past several decades, funded with the money he makes trading with us knuckleheads.

As for this investment, energy over the next couple of decades is going to become more expensive as the world moves towards 50% more people at the projected peak in 2050 and a higher standard of living among the billions that are aspiring towards a more comfortable existence.

Overall I like Mr. Soros thinking more than his stock picking, while he does very well in that area his understanding of currencies is unmatched, a fact that seems to irritate the heck out of some people that would never vilify someone for having a great equities or bond strategies.

May 05 01:28 PM

[B smith:]

Kind of fits with the possible obama opening up of selected US areas for drilling...

May 05 08:33 PM

[phubaiguy:]

Buy.

May 15 01:32 AM