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Charles I. Clough is the founder of Clough Capital Partners, which reported $5.2 Billion total assets in its last 13F filing. Clough graduated from Boston College with a B.A. degree and received his M.B.A. from University of Chicago.

Clough launched Clough Capital Partners in 2000 after working as a Chief Investment Strategist for 13 years at Merrill Lynch. Clough was responsible for directing the global investment strategy research effort at Merrill Lynch. Clough has been selected to the Institutional Investor All-America Research Team for 12 consecutive years. He is also one of the top strategists in areas such as US equities, global investments and fixed income.

According to 13F filings, Clough Capital Partners had 208 securities in its 13F portfolio as of December 31, 2010. Insider Monkey, a source for free insider trading data, noticed that Clough has been holding 9 of these securities during last five years. In the last quarter of 2010, he sold 46 securities and bought 74 new securities. Here are the 10 largest new stock picks:

Top Ten New Holdings

Stock

Value in Millions (USD)
As of Dec 31,2010

Return
Since Dec 31,2010

INTERNATIONAL BUSINESS MACHS (NYSE:IBM)

55.6

11.1%

NATIONAL GRID PLC (NYSE:NGG)

42.9

4.4%

WEATHERFORD INTERNATIONAL LT (NYSE:WFT)

37.0

-9.1%

DEVON ENERGY CORP NEW (NYSE:DVN)

18.1

12.4%

UNITED CONTL HLDGS INC (NYSE:UAL)

15.8

3.8%

LIBERTY MEDIA CORP NEW (LCAPA)

14.3

16.7%

M & T BK CORP (NYSE:MTB)

13.9

1.5%

SENSATA TECHNOLOGIES HLDG BV (NYSE:ST)

12.2

8.3%

FIDELITY NATL INFORMATION SV (NYSE:FIS)

11.4

14.0%

ABBOTT LABS (NYSE:ABT)

11.2

2.1%

Value Weighted Return of Top 10 New Holdings

232

5.6%

SPY

N/A

4.0%

Clough’s largest new stock picks have gained 5.6% since the end of 2010, vs. 4.0% gain for the S&P 500 (NYSEARCA:SPY). LCAPA has had one of the best performances in his portfolio since the end of December. Clough had $14.3 million in LCAPA shares at the end of December. LCAPA has gained 16.7% in the last 75 days, beating the SPY by 12.7 percentage points. Tiger Global’s Chase Coleman, Daniel Loeb’s Third Point and Whitney Tilson's T2 Partners are other investors of LCAPA as the end of December. IBM was Clough's biggest new investment at the end of December 2010. IBM has gained 11.1% since then, outperforming the SPY’s 4.0% return. Clough has $55.6 million invested in IBM. Bill Miller also had $283 million invested in IBM. The worst performing stock among the new purchases was Weatherford International, losing 9.1% since the end of December. T. Boone Pickens and Barry Rosenstein’s Jana Partners have WFT in their portfolios.

Clough uses put options on index funds extensively to protect his portfolio from market declines. That’s why the biggest position in his portfolio is a put option on S&P 500 Index fund with a notional value of $2.06 Billion. He also has put options on First Trust NASDAQ-100 Ex-Techn (NASDAQ:QQXT) and Oil Services Holders (NYSEARCA:OIH) totaling more than $400 Million. Other than these, here are the 10 largest positions in Clough’s portfolio at the end of December:

Top Ten Holdings

Stock

Value in Millions (USD)
As of Dec 31,2010

Return
Since Dec 31,2010

MICROSOFT CORP (NASDAQ:MSFT)

223.6

-0.3%

VERIZON COMMUNICATIONS INC (NYSE:VZ)

67.2

1.5%

GOOGLE INC (NASDAQ:GOOG)

58.2

-2.9%

INTERNATIONAL BUSINESS MACHS (IBM)

55.6

11.1%

ANNALY CAP MGMT INC (NYSE:NLY)

51.8

-1.2%

NATIONAL OILWELL VARCO INC (NYSE:NOV)

49.7

13.2%

BANK OF AMERICA CORPORATION (NYSE:BAC)

47.8

7.9%

CAMERON INTERNATIONAL CORP (NYSE:CAM)

45.6

16.4%

HATTERAS FINL CORP (NYSE:HTS)

43.4

1.4%

NATIONAL GRID PLC (NGG)

42.9

4.4%

Value Weighted Return of Top 10 Holdings

685.8

3.6%

SPY

N/A

4.0%

Five of Clough’s top 10 positions managed to beat the market.

Clough’s largest stock picks have gained 3.6% since the end of 2010, vs. 4.0% gain for the SPY. CAM has had one of the best performances in his portfolio since the end of December. Clough had $45.6 million in CAM shares at the end of December. CAM has gained 16.4% in the last 75 days, beating the SPY by 12.4 percentage points. MSFT was Clough’s biggest investment at the end of December 2010. MSFT has lost 0.3% since then, underperforming the SPY’s 4.0% return. Clough has $223.6 million invested in MSFT. Blue Ridge Capital’s John Griffin, Legg Mason Capital Management's Bill Miller, Farallon Capital Management's Tom Steyer, Greenlight Capital's David Einhorn and Appaloosa's David Tepper are other investors of Microsoft.

Return of Long Term Holdings in Last 5 Years

Stock

Value in Millions (USD)
As of Dec 31,2010

Return
Since Mar 16,2006

OIL SVC HOLDRS TR (OIH)

84.3

26.4%

MICROSOFT CORP (MSFT)

66.5

3.4%

ANADARKO PETE CORP (NYSE:APC)

31.2

61.2%

CONSOL ENERGY INC (NYSE:CNX)

24.1

56.0%

ARCH COAL INC (NYSE:ACI)

22.4

-5.1%

PEABODY ENERGY CORP (NYSE:BTU)

19.5

47.8%

CHICAGO BRIDGE & IRON CO N V (NYSE:CBI)

16.4

37.9%

GOLAR LNG LTD BERMUDA (NASDAQ:GLNG)

8.7

75.2%

MAGAL SECURITY SYS LTD (NASDAQ:MAGS)

2.4

-77.1%

Average Return

275

25.1%

SPY

N/A

11.7%

The above table shows the performance of Clough's long-term stock holdings. Clough's largest investment over the last five years is OIH. OIH has returned almost 26% since March 2006, beating the market by 14.7 percentage points. Clough's largest long term holdings have gained 25.1% since March 2006, outperforming the SPY’s 11.7% return.



Disclosure: I am long MSFT, SPY.

Source: Charles Clough's Top Holdings and New Stock Picks