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Viking Global Investors was founded by Andreas Halvorsen in 1999. The firm mainly focuses on financial, telecommunication, media, technology, and consumer sectors across the globe. It employs bottom-up stock picking approach as well as long/short strategy to make its investments. Halvorsen graduated from Williams College in 1986 and earned his MBA from Stanford University. He also had experience at Morgan Stanley and Tiger Management, so he is more than qualified to manage the Viking Global Investors.

Mr. Halvorsen and his team have been able to produce consistently high returns since Viking Global Investors’ establishment. It returned an astonishing 89% after fees in its first full year. Between June 2005 and March 2010, Viking Global returned 119% versus 11% for the MSCI World Index. It lost 1.9% in 2008, gained 20% in 2009, and returned 3.8% in 2010. However, since the end of the second quarter, Viking Global’s top long stock picks has lost 13.2% versus the S&P 500’s 10.7% loss during the same period.

Viking Global’s top stock picks at the end of June:

Company

Ticker

Value (x1000)

Activity

Return Since June

INVESCO LTD

IVZ

715090

24%

-27%

TIME WARNER CABLE

TWC

706949

17%

-18%

LAUDER ESTEE COS INC

EL

577790

-21%

-9%

PRICELINE COM INC

PCLN

506524

9%

3%

NEWS CORP

NWSA

484241

36%

-8%

LYONDELLBASELL

LYB

454562

204%

-16%

AMAZON COM INC

AMZN

415482

388%

3%

JPMORGAN CHASE & CO

JPM

390543

-6%

-15%

SHERWIN WILLIAMS CO

SHW

336564

-27%

-13%

VIACOM INC

VIA.B

325742

-11%

-3%

BLOCK H & R INC

HRB

324276

21%

-16%

SEAGATE TECHNOLOGY

STX

323782

New

-33%

JOHNSON CONTROLS

JCI

303640

-39%

-28%

POTASH CORP

POT

301049

3%

3%

BAIDU INC

BIDU

300230

-3%

0%

PENN WEST PETE

PWE

266707

1%

-23%

U S BANCORP DEL

USB

247870

25%

-15%

TALISMAN ENERGY INC

TLM

245466

83%

-22%

VALEANT PHARMA

VRX

236870

-31%

-16%

GOODRICH CORP

GR

236742

318%

-11%

HUMANA INC

HUM

223047

332%

-8%

CARDINAL HEALTH INC

CAH

222938

159%

-9%

MARSH & MCLENNAN

MMC

222505

-3%

-6%

DAVITA INC

DVA

216814

-6%

-18%

UNIVERSAL HEALTH SE

UHS

202991

-15%

-25%

Viking Global Investors’ low average return since the end of last quarter is due to several of the fund’s large holdings producing very low returns. For example, Viking Global’s 12th largest position, Seagate Technology (NASDAQ:STX), had a negative 33% return. Viking Global initiated a brand new $324 Million position in STX during the second quarter. Other unlucky hedge funds with STX in their big holdings include Peninsula Capital Management and Greenlight Capital (check out Peninsula’s top stock picks). Viking Global also had major losses through its positions in Invesco Ltd (NYSE:IVZ), losing 27%, and in Johnson Controls Inc (NYSE:JCI), losing 28%. They also had moderate losses in Time Warner Cable (NYSE:TWC), LyondellBasell (NYSE:LYB), JP Morgan (NYSE:JPM) and H&R Block (NYSE:HRB).

One of Viking Global’s largest positive returns is Amazon (NASDAQ:AMZN); the hedge fund gained 3% from this investment. Viking Global increased its position in AMZN by 388% in the second quarter. AMZN is also a favorite of Tiger Management and Blue Ridge Capital (check out Tiger’s top stock picks). Viking Global also gained through its positions in Priceline (NASDAQ:PCLN) and Potash Corp (NYSE:POT) since June, and it increased its holdings in both stocks during the second quarter.

We like Andreas Halvorsen. His experience is invaluable in a long/short hedge fund like Viking Global. Even though Viking Global Investors’ long stock picks underperformed the market, three of its top five stock picks managed to beat the market. Viking Global also hedged its exposure through short positions and investments in hedging markets across the globe. We believe investors can outperform the market over the long-term by focusing on Viking Global Investors’ best stock picks.



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

Source: Viking Global's Top Stock Picks