Andrew Hall was a star trader at Phibro LLC, an international commodities trading firm that trades in oil, natural gas, metals, and other commodity products. In February 2010, Hall launched Astenbeck Capital with Occidental Petroleum Corporation. Their goal is to manage hedge funds on behalf of Phibro’s investors. Astenbeck Capital mainly invests in energy and commodities and 80% of the fund is owned by Andrew Hall today, while the remaining 20% is owned by Occidental Petroleum.
Top 20 positions of Astenbeck Capital at the end of September.
CompanyName | Ticker | Value | Activity |
SECTOR SPDR TRUST | 164803 | 17% | |
OIL SERVICE HOLDRS TRUST | 54284 | 5% | |
TOTAL S A | 48948 | New | |
CHEVRON CORP NEW | 30847 | 82% | |
MARKET VECTORS E T F TRUST | 30260 | 1% | |
ROYAL DUTCH SHELL PLC | RDS | 28323 | 60% |
SCHLUMBERGER LTD | 24675 | 29% | |
BP PLC | 20880 | New | |
CONOCOPHILLIPS | 20747 | 110% | |
SPDR SERIES TRUST | 20191 | 1% | |
HALLIBURTON COMPANY | 18889 | 11% | |
NATIONAL OILWELL VARCO | 18028 | -12% | |
HESS CORP | 16963 | 28% | |
APACHE CORP | 15890 | 239% | |
WHITING PETROLEUM CORP | 14392 | 82% | |
ANADARKO PETROLEUM CORP | 11621 | 59% | |
MURPHY OIL CORP | 10251 | 30% | |
EOG RESOURCES INC | 10002 | New | |
CORE LABORATORIES NV | 8831 | 4% | |
DEVON ENERGY CORP NEW | 7952 | 1% |
The value of Astenbeck’s portfolio increased from $611 million at the end of June to $644 million at the end of September. It also had more positions. At the end of the second quarter, Astenbeck had 38 positions in the portfolio, while it now has 49 positions. Over the third quarter, the fund bought many new positions and also sold out five positions. For instance, the fund had $3.9 million invested in Mosaic Company (MOS) at the end of June, but it did not disclose owning any shares of the stock at the end of September. MOS gained 4.13% so far since the end of September, lower than the 5.80% of SPY. Astenbeck also sold out Consol Energy Inc (CNX), Marathon Oil Corp (MRO), Range Resources Corp (RRC), and Tetra Technologies Inc (TTI).
On the other hand, Astenbeck also opened some new positions in the third quarter. The largest new position is Total SA (TOT). According to Astenbeck’s latest 13F, the fund initiated a brand new $49 million of TOT over the third quarter. TOT was up 11.78% since the end of the third quarter, beating the market by nearly 6 percentage points. Astenbeck also bought new stakes in BP Plc (BP) and EOG Resources Inc (EOG). The fund reported to own $21 million of BP and $10 million worth of EOG at the end of September. BP returned 14.28% and EOG gained 34.88% since then, both outperforming the market by a margin.
Astenbeck was also bullish about Sector SPDR Trust (XLE) and Service Holdings Trust (OIH). These two positions, together with TOT, were the top three positions in Astenbeck’s portfolio at the end of the third quarter. Astenbeck also increased its stakes in both stocks over the third quarter. It increased its position in XLE by 17% to $165 million and its position in OIH by 5% to $54 million. Since the end of September, XLE returned 13.18% and OIH gained 14.04%, both outperforming the market.
Astenbeck is performing quite well in the fourth quarter. The main positions and the new positions in the portfolio all had better than market performance so far. In addition, Andrew Hall’s previous experience as well as the ownership of Occidental Petroleum is invaluable to a hedge fund focusing on the energy and commodities sector. We believe that by focusing on the best stock picks of Astenbeck Capital Management, investors will be more likely to outperform the market in the long term.
Disclosure: I am long COP.
