Julian H. Robertson is one of the best hedge fund managers of all time. There are a few people who are better than he is, but there's no doubt that he is absolutely the best hedge fund manager recruiter. His picks are known as “Tiger Cubs”, and some of them have been running the top hedge fund firms. Toscafund Asset Management is one of them, founded by Martin Hughes in 2000. It's based in London. Currently, the firm employs 37 people, of which 26 are partners. In 2010, Toscafund won the ”best European Equity fund under $500 Million” award with Tosca Mid-Cap in UK equity. In 2008, Toscafund had more than $7 Billion AUM. But due to a 67% loss that year, the company now manages only $4 Billion.
According to the latest 13F filings, the fund had $177 Million in U.S. equities. Here are the stocks Toscafund owned at the end of December:
1. Citigroup Inc (C): Toscafund’s $45.6 Million investment in C returned 1.7% since the end of December. Toscafund was bullish about Citigroup during the fourth quarter. Hughes increased his Citigroup holdings by 50%. Paulson & Co, Pershing Square and Maverick Capital are among the other Citigroup investors.
2. Las Vegas Sands Corp (LVS): LVS gained 9.4% since December. Hughes invested $44 Million. The stock holdings of LVS was reduced by 12% during the last quarter.
3. Phoenix Companies Inc (PNX): Toscafund had $22 Million in PNX. The position returned 0.8% since the end of December. Hughes didn’t change his stock holdings in the last quarter.
4. Hartford Financial Services Group (HIG): Toscafund’s $19 Million investment returned 8.4% since December, outperforming the SPY by 4.4 percentage points. Toscafund had 700,000 shares of HIG. John Paulson has HIG shares in his portfolio too.
5. SLM Corp (SLM): Toscafund returned 16% from its SLM investment of $15 Million since December.
6. Longtop Financial Technologies LTD (LFT): Hughes’ LFT investment is the only stock with negative returns, losing 1.2% since the end of December. Fortunately, he had only $9.4 Million worth of stock holdings, which was increased by 22% during the last quarter of 2010. Facebook billionaire Chase Coleman's Tiger Global has LFT shares in his portfolio as well.
7. Willis Group Holdings LTD (WSH): Hughes returned 7.2% from its $9.2 Million long position at WSH since the end of December. Hughes reduced its stock holdings by 6% since the end of September. Cantillon Capital Management is a Willis Group Holdings investor too; it was their largest US equity position at the end of September.
8. Western Union Co (WU): Toscafund owned $8.9 Million worth of WU, which returned 11.4% since the end of December. This is another spectacular pick, beating the SPY by more than 7 percentage points in less than a month. Toscafund reduced its stock holdings by 16% during the last 3 months of 2010. Barry Rosenstein's Jana Partners is among the other hedge funds with WU positions.
9. JP Morgan Chase & Co (JPM): Hughes had $4 Million worth of JPM stock at the end of December. The stock returned 7.2%, beating the SPY by 3.2 percentage points since then. Hughes reduced his JPM holdings by 55% during the last quarter. Second Curve’s Tom Brown is extremely bullish about JP Morgan. Stephen Mandel is a JPM investor too.
Since the end of December, Toscafund’s weighted average return is 7.6%, beating the SPY by 3.6 percentage points. Two thirds of his positions managed to beat the S&P 500 index. Insider Monkey, your source for free insider trading data, will be tracking Martin Hughes’ performance going forward.