Seth Klarman of Baupost Group: Top 10 Holdings

Seth Klarman is profiled in this recent article from the NYTimes entitled "Manager Frets Over the Market, but Still Outdoes It". Klarman returned 22% last year while holding HALF his portfolio in cash. From the NYT article:

Mr. Klarman’s record has generated intense loyalty from investors. Since he began Baupost in 1983, it has posted an average annual total return of 19.55 percent, according to data provided by the hedge fund group. Declines have been posted in only 11 of the total 97 quarters since Baupost’s debut.

In 2006, Baupost’s portfolio held an array of assets, including United States, European, Asian and Canadian equities, which accounted for 17.1 percent of the portfolio; debt and real estate, which each made up 10 percent; and 4.7 percent in private equity funds. And there was that big dollop of cash.

“Seth has a remarkable record, and even more so when you realize that he has achieved it by holding significant amounts of cash,” said Jack R. Meyer, who until 2005 ran Harvard’s endowment, which has been a longtime investor in Baupost.

“In other words, his risk-adjusted numbers are spectacular. What is unusual is the high return and the high cash levels,” added Mr. Meyer, who now runs the investment fund Convexity Capital.

What does Klarman own now? Below are his top 10 holdings:

SLM CORP (SLM)
DOMTAR CORP (UFS)
HOME DEPOT INC (HD)
NEWS CORP (NWS)
SYNERON MEDICAL LTD (ELOS)
INFOSPACE INC (INSP)
MARATHON ACQUISITION CORP (MAQ)
OMNOVA SOLUTIONS INC (OMN)
STAR MARITIME ACQUISITION CO (SEA)
NATIONAL FUEL GAS CO N J (NFG)

Comments

[ryahhlkiaafs]

Most of his returns come from his distressed investments

[BrianPursley]

Seth Klarman's speech at MIT is one of the most important speeches I've ever read.