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Whitney Tilson founded T2 Partners in 1999 along with Glenn Tongue. Under T2 Partners, Tilson manages T2 Accredited Fund, Tilson Offshore Fund, and T2 Qualified Fund. These are all private investment partnerships which are value-oriented. Whitney Tilson is known to be a very modest value investor. At the end of March 2011, T2 Partners’ portfolio was valued at just $399 million. Nonetheless, he is highly recognized for his contribution in the field of value investment and behavioral finance. Tilson is also a renowned author who co-founded an investment newsletter called Value Investor Insight.

Whitney Tilson’s T2 Partners has returned 177.1% since its inception while S&P returned 36.4%. Earlier this year, Tilson expressed concern about the high sovereign debt levels in Europe and Japan. He is not very optimistic about the stock market in 2011. However, he is still bullish about 6 stocks which are Grupo Prisa (GROFK.PK), Microsoft (NASDAQ:MSFT), Berkshire Hathaway (NYSE:BRK.B), British Petroleum (NYSE:BP), General Growth Properties (NYSE:GGP), and CIT Group (NYSE:CIT). We have discussed these stocks in detail in our article, "6 Stocks Whitney Tilson Extremely Bullish."

T2 Partners underperformed the market in 2010 by 4.8 percentage points. Tilson’s top 20 holdings lost 8.6% since the end of March 2011. There were no major decrease in his holdings expect for General Growth and BP Plc. He reduced General Growth (New) by 11% and BP Plc by 34%. Since the end of first quarter 2011, GGP lost 9.7% while BP lost 5.5%. Here are Tilson’s top 20 stock picks at the end of March:

Stock

Ticker

Value (x1000)

Return

Spdr S & P 500 ETF Trust (Put)

SPY

82723

-9.0%

Microsoft Corp (CALL)

MSFT

33863

1.8%

Berkshire Hathaway (CALL)

BRK.B

22990

-14.8%

Penney J C Co Inc (CALL)

JCP

16763

-20.2%

Microsoft Corp

MSFT

14862

1.8%

Berkshire Hathaway Inc Del

BRK.B

12798

-14.8%

Seagate Technology

STX

12693

-14.3%

Kraft Foods Inc (CALL)

KFT

12133

12.1%

C I T Group Inc New

CIT

11589

-18.8%

Iridium Communications (Class 1)

IRDM

10313

-1.0%

Iridium Communications (Class 2)

IRDM

10145

-1.0%

General Growth Pptys New

GGP

9449

-9.7%

Anheuser Busch Inbev

BUD

8830

-3.2%

Howard Hughes Corp

HHC

8330

-26.0%

B P Plc

BP

8002

-5.5%

Resource America Inc

REXI

7018

-19.8%

Johnson & Johnson (CALL)

JNJ

6565

6.8%

Two Harbors Investment Corp

TWO

6198

-5.8%

Delia S Inc New

DLIA

5543

-6.1%

Coinstar Inc

CSTR

4822

-6.7%

Tilson is bullish about Microsoft Corp. MSFT returned 1.8% since the end of first quarter. He increased his Microsoft call options by 451% and Microsoft stocks by 44%. He has $33.86 million in MSFT call options and 585 thousand shares of the company valued at $14.86 million. Ken Fisher is another investor who is highly bullish about Microsoft. Fisher had the largest position in the company with 17.73 million shares worth $450 million (Check out Ken Fisher’s other bullish stock picks).

Tilson’s T2 Partners has two classes of Iridium Communications Inc in its portfolio. Iridium beat the S&P 500 index by 8 percentage points since the end of March. Collectively, the two classes of Iridium make up 5.12% of Tilson’s 13F portfolio. Tilson has the largest position in Iridium Communications after Peter J. Eichler Jr.’s Aletheia Research. Alethia has 5.18 million shares of Iridium as of March 31st (View Peter J. Eichler Jr.’s top holdings).

Another stock Tilson is bullish about is CIT Group. In the first quarter of 2011, he increased his CIT holdings by 14%. He had $12 Million in CIT. It makes up 2.9% of his 13F portfolio. Bruce Berkowitz’s Fairholme has the largest position in CIT Group. Berkowitz had $845 Million in CIT at the end of March (Check out Bruce Berkowitz’s current portfolio). Howard Marks’ Oaktree Capital Management has the second largest position. In the first quarter of 2011, he initiated a $371 Million position in the stock.

Whitney Tilson’s holdings have outperformed the market by 0.4 percentage points. We believe his bullish stock picks will outperform the market in the long-run.

Disclosure: I am long MSFT, SPY.

Source: Whitney Tilson's Favorite Stock Picks