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Whitney Tilson, who has a reputation for picking unloved stocks, often shares his views on investments with the public. He co-authored the “More Mortgage Meltdown: 6 Ways to Profit in These Bad Times”, which was published in May 2009. He has also written for Forbes, the Financial Times, Kiplinger’s, Motley Fool and TheStreet.com. T2 Partners was founded by Whitney Tilson and Glenn Tongue in 1999. Tilson has a Bachelor's degree in Government from Harvard and an MBA with High Distinction from Harvard Business School. His T2 Partners returned approximately 177% since inception, versus 36.4% gain of S&P 500.

Tilson reduced his portfolio from $353 million at the end of the second quarter to $274 million at the end of the third quarter. The fund also reduced its number of holdings from 97 to 70. Tilson sold out a few positions over the third quarter. For instance, the fund reported to own $13.6 million worth of Kraft Foods Inc Call (KFT) at the end of June and it did not disclose owning any shares in KFT stocks or options at the end of September. KFT returned 4.76% since the end of September, underperforming the SPY by 5%. Tilson also sold out General Growth Properties Inc (NYSE:GGP) in the third quarter. GGP returned 17.75% since the end of September. The company reported third-quarter revenue of $666.85 million, down from $670.19 million for the same quarter last year. In addition to KFT calls and GGP stocks, Tilson also sold out Johnson & Johnson calls (NYSE:JNJ), BP Plc (NYSE:BP), Intel Corp (NASDAQ:INTC), and Blue Coat Systems Inc (NASDAQ:BCSI). Here are his top 20 positions:

CompanyName

Ticker

Value

Activity

JC PENNEY Calls

JCP

24605

2%

BERKSHIRE HATHAWAY

BRK.B

17999

64%

BERKSHIRE HATHAWAY Calls

BRK.B

16503

218%

DELL INC

DELL

15168

160%

MICROSOFT CORP Calls

MSFT

12405

-63%

IRIDIUM COMMUNICATIONS INC

IRDM

11465

12%

HOWARD HUGHES CORP

HHC

10928

47%

GOLDMAN SACHS Calls

GS

9455

New

ISHARES Russell 2000 ETF Puts

IWM

8681

New

WESTERN DIGITAL CORP

WDC

7768

142%

PENNEY J C CO INC

JCP

7385

New

CITIGROUP INC

C

7029

3335%

PROMOTORA DE INFORMACIONES

PRIS

6316

16%

NELNET INC

NNI

5639

9%

MICROSOFT CORP

MSFT

5527

-50%

WELLS FARGO & CO Calls

WFC

5475

New

GOLDMAN SACHS

GS

5451

New

PEP BOYS MANNY MOE & JACK

PBY

5283

20%

ANHEUSER BUSCH INBEV SA NV

BUD

4903

-19%

RESOURCE AMERICA INC

REXI

4892

0%

ACTIVISION BLIZZARD INC

ATVI

4463

-11%

DELIA S INC NEW

DLIA

4177

2%

TERRA NOVA ROYALTY CORP

TTT

3806

70%

I D T CORP

IDT

3665

53%

COINSTAR INC

CSTR

3120

64%

Tilson increased his investments in Warren Buffett’s Berkshire Hathaway Inc (BRK). At the end of second quarter, T2 Partners disclosed owning $11.9 million worth of BRK-B and $5.6 million worth of BRK-B Call. During the third quarter, Tilson increased his stake in BRK-B by 64% and almost doubled his position in the call option. BRK-B returned 5.11% since the end of September. Tilson also increased his position in Dell Inc (NASDAQ:DELL) by 160% to $15.2 million, and Citigroup Inc (NYSE:C) to $7.0 million. DELL returned 7% and C returned 4.88% since the end of the third quarter.

Over the third quarter, Tilson bought new stakes in Goldman Sachs Group Inc (NYSE:GS). T2 Partners disclosed to own $5.45 million worth of GS stocks and $9.46 million worth of GS call options at the end of September. The fund did not report to hold any shares of GS stocks or calls at the end of June. Unluckily, Goldman reported third-quarter net loss of $393 million and its stock only returned 1.11% since the end of the third quarter, versus 9.66% for SPY. T2 Partners also opened new position in Wells Fargo & Co calls (NYSE:WFC) and increased its stake in WFC stocks by 163% to $2.82 million. WFC returned 3.92% since the end of September. It is one of the 10 most popular stocks among hedge funds tracked by Insider Monkey. Warren Buffett, John Paulson, Ken Fisher and many other hedge fund managers were bullish about WFC.

It is interesting to see that Tilson reduced his long-term bets Microsoft (NASDAQ:MSFT) and Anheuser Busch (NYSE:BUD). It seems like he put most of his money on his high conviction ideas and cut back his other bets. After the close of the third quarter Tilson also disclosed that he initiated a long position in Netflix (NASDAQ:NFLX) after the stocks’ huge plunge. We like Tilson. He is a very modest value investor and his T2 Partners has a great track record. We believe that by focusing on Tilson’s best stock picks, investors are more likely to beat the market in the long term.

Source: Whitney Tilson's Top Stock Picks