What do the top Hedge Fund Gurus like in the Oil and Gas Exploration Industry? This article, the seventh in a series, identifies through a research of the latest available institutional 13-F filings the Gurus who are most invested in the Oil and Gas Exploration Industry, and the specific Oil and Gas Exploration companies that they prefer to hold in their hedge fund portfolios.
The first six articles in the series identified Gurus who are over-weight in the Solar sector, Utilities sector, China stocks, Airline sector, Optical Networking sector and the Chemicals industry, and the stocks within those sectors that they hold in their portfolios (For those familiar with the series, skip over to the fifth paragraph).
A Guru is defined as someone who is regarded as having great knowledge, wisdom, and authority in a certain area. When it comes to hedge funds, there are a number of ways to anoint leading managers as Gurus including long-term performance, low portfolio volatility and an elite reputation in the investment community.
Many of us are familiar with leading investors and hedge fund managers such as Warren Buffett, George Soros, Carl Icahn and Julian Robertson, but the hedge fund community alone includes over 9,000 funds; add in mutual funds, ETFs, and other investment entities and the number is likely to be at least two to three times that number. While there is no official list of Gurus, less than one percent or between 100 to 200 fund managers are commonly believed by the larger investment community to have earned the distinction of being called Gurus.
The study of the investing habits of Gurus can be informative as these are very savvy, well-respected investors with high personal net worth deploying large sums of capital from their funds on a regular basis. They have a long-term track record of success, and while one can easily just ride their coattails, the savvy investor may want to use these lists as a starting point to conduct their own due diligence.
The total capitalization of the US Equity markets is somewhere in the $15 trillion range, and the total market capitalization of leading Oil and Gas Exploration stocks is approximately $3 trillion or 20% of the overall market. The Table lists four investment Gurus whose funds have invested over 20% in the Oil and Gas Exploration Industry, and the following is a list of their picks in that industry:
Global oil and gas exploration companies such as Brazil-based Petroleo Brasileiro SA or Petrobras (NYSE:PBR
), California-based Occidental Petroleum (NYSE:OXY
), Houston-based EOG Resources, Inc. (NYSE:EOG
) and Oklahoma City-based Devon Energy Corp (NYSE:DVN
) that have properties worldwide.
U.S. oil and gas exploration companies such as Sandridge Energy Inc. (NYSE:SD
), Chesapeake Energy (NYSE:CHK
), Petrohawk Energy Corp. (NYSE:HK
), and Exco Resources Inc. (NYSE:XCO
) with on-shore properties in the continental U.S such as in Texas, Oklahoma, Louisiana, Arkansas and Kansas, and in the Appalachian basin in Virginia and Pennsylvania.
U.S. oil and gas exploration companies such as Mcmoran Exploration Co. (NYSE:MMR
) that have both on-shore and off-shore properties in the Gulf of Mexico.
Suncor Energy Inc. (NYSE:SU
) with oil sands properties in Canada.
Fund and Guru
Type of Fund
Assets Under Management
Percent Portfolio in Chinese Stocks
Major Oil and Gas Exploration company positions in Portfolio
BP Capital Management, LP (T Boone Pickens)
Hedge Fund – Commodities Focused
$ 275 million
Touradji Capital Management, LP (Paul Touradji)
Hedge Fund – Commodities Focused
$ 2.5 billion including $280 million in Equities
Invesco Private Capital, Inc. (Wilbur Ross)
Hedge Fund – Distressed Investing
$ 920 million
Tyrus Capital, LLP (Tony Chedraoui)
Hedge Fund – Event-driven
$ 116 million
Legendary T Boone Pickens, who has made his money as an ‘oil’ man, recently may have caught our attention when he focused his advocacy on Alternative Energy such as solar and wind through a series of paid advertisements in various media outlets that outlined the ‘Pickens Plan’ for American energy independence. He is a billionaire, worth $2.5 billion and is the chair of BP Capital Management.
Touradji Capital Management, LP, is a commodities-focused hedge fund founded by Paul Touradji. He previously worked as a trader from 1996 to 2000 in Julian Robertson’s legendary Tiger Management.
Wilbur Ross is the founder of hedge fund Invesco Private Capital. He specialized in leverage buyouts (LBOs) and is well known for investing in distressed companies and restructuring failed companies.
Tony Cherdaoui founded Hedge fund Tyrus Capital in 2009, and specializes in event-driven investments.
Source: Historical fundamentals including operating metrics and stock ownership information were derived using I-Metrix® by Edgar Online®, Zacks Investment Research, Thomson Reuters and Briefing.com. The information and data is believed to be accurate, but no guarantees or representations are made.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.