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Soros Fund Management LLC is one of the most successful and high-profile hedge funds managed by billionaire hedge fund manager George Soros. Soros returned an average of 30.5% per year between 1969 and 2000. More recently in 2007, 2008, and 2009, his fund generated 32%, 8% and 29% return respectively for the investors.

The following is a list of top 10 stocks where Soros Fund Management LLC decreased its position in the last quarter (Source: 13F filing ).

Stock

Symbol

Shares Held - 03/31/2011

Shares Held - 06/30/2011

Change in shares

Citigroup, Inc.

C

29385033

64600

-29320433

Monsanto Co.

MON

2658998

79400

-2579598

Teva Pharmaceutical Industries Limited

TEVA

2134000

41400

-2092600

Wells Fargo & Company

WFC

3505100

77700

-3427400

CVS Caremark Corporation

CVS

2926676

508835

-2417841

Dendreon Corp.

DNDN

4671699

2586366

-2085333

Express Scripts Inc.

ESRX

1318700

3900

-1314800

Amazon.com Inc.

AMZN

293400

12745

-280655

Weatherford International Ltd.

WFT

3498700

458600

-3040100

Apple Inc.

AAPL

230433

70795

-159638

Citigroup and Wells Fargo are down more than 30% and 15% respectively from July 1. Soros Fund Management was able to avoid significant losses by timely reducing these positions. I am still skeptical about prospects of weaker banks like Citigroup and Bank of America (BAC). I believe buying stocks of these banks are equivalent (similar risk reward) to buying call options on US recovery. Wells Fargo is comparatively well capitalized and if one does need to take a position in the banking sector, I would suggest Wells Fargo as it has better risk reward.

Amazon also looks like a good sell in current uncertain times as its high PE leaves an ample scope for a multiple compression during downturn.

However, I don’t agree with Soros Fund Management on Apple and Monsanto and would actually like to go long on these stocks.

I believe the recent pullback in Apple provides a good opportunity to build a position in the stock before the upcoming iPhone 5 launch. The IPhone 5 is likely to drive typical excitement during the 2011 holiday season with growth driven by upgrades and new users. Apple is a secular growth and market share gain story in the smartphone and tablet space. At 11x next year EPS and cash in hand of ~ $75 bn, it is one of the best stocks to buy in current uncertain times.

Monsanto is a good buy in the current uncertain environment, given the defensive nature of seeds, prospects for double-digit earnings growth and a reasonable valuation. Monsanto is trading at 20x FY12 (Aug) EPS and has a dividend yield of 1.8%. I see limited downside risk to earnings given growth prospects in biotech seeds and low sensitivity to the economic cycle. Also I am quite bullish on the commodity prices given the excess amount of money supply that has entered the system thanks to bailouts, quantitative easing and stimulus. In particular, when we talk of food grains where demand is inelastic, the trend is likely headed up in the mid-long term even if we consider a prolonged recession scenario. This translates to higher farm income and improved value proposition for Monsanto’s grower customers, which should support price/mix.

CVS and Express Scripts are also good defensive healthcare stocks. ESRX has recently announced the acquisition of Medco (MHS), which can give it an edge in its dispute against Walgreens (WAG). For more details visit my previous article here.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: George Soros Is Decreasing His Stake in These Top Stocks