Soros Fund Management's 2012 Equity Liquidations And Reductions (Part 2)

by: Zvi Bar

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Soros Fund Management LLC is considered one of the most successful and high-profile hedge funds, largely due to its long record of performance. George Soros, the fund's high profile and politically influential founder, is considered one of the best living currency and equity investors, with a net worth estimated at over $14 billion.

Funds like Soros Fund Management are required to provide quarterly filings that state what positions the fund was holding at the end of the prior quarter. By looking at these filings, we are able to ascertain what investments, if any, acclaimed investors may have initiated in the recent past, as well as what investments they might have dropped.

Below is part 2 of a list of investments in which Soros Fund reduced its exposure, according to the fund's most recently filed 13F. This filing does not include all investments and sales made by the fund, as the 13F only includes positions in U.S. equities, and not bonds, foreign market equities (unless an ADR), commodities or currencies. The positions are listed alphabetically. I have only included individual equities, as the fund also acquired and reduced some positions in various Exchange Traded Funds.

Because Soros Fund Management liquidated far less U.S. equity positions than it reduced, I will list those two equities first.

Reduced Positions (Part 2)

The Medicines (NASDAQ:MDCO)

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The Soros Fund owned 250,000 shares of MDCO, a small-cap drug manufacturer, at the end of Q1 2012, having previously reported owning 1.6 million shares. Given the significance of the reduction, it is entirely possible that the fund is liquidating the position and that the fund's selling continued into Q2, though such is no certainty.

Mercury Computer (NASDAQ:MRCY)

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Soros Fund Management reduced its position in this small-cap computer peripheral maker from 2,292,446 shares at the end of 2012 to 1,895,120 shares at the end of Q1 2012. Despite this position reduction, the fund is still one of the largest holders of MRCY shares, amounting to 6.12 percent of the company. MRCY shares have been in a state of gradual decline for the last three months. Shares in MRCY are down about 12 percent over the last month and also year-to-date.

Motorola Solutions (NYSE:MSI)

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Soros Fund Management acquired a position in MSI early in 2011, as well as a position in MMI, the mobility potion of the former Motorola, which was acquired by Google (NASDAQ:GOOG) and fully absorbed into it during Q2 of 2012. The hedge fund had reduced its position in MSI last year, but still maintained a sizable holding. At the end of 2011, Soros Fund Management reported it owned 5,152,789 shares, which it reduced to 2,878,116 shares, which would equal approximately one percent of outstanding shares. Here, like with MMI, the hedge fund may expect the entity to be acquired. MSI is down about 7.5 percent over the last month, but still up about 3.5 percent so far in 2012, having traded in a reasonably narrow trading range so far this year, especially compared to the broader market.

Wells Fargo (NYSE:WFC)

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At the end of 2011, Soros Fund Management owned 1.2 million shares of WFC, one of the largest retail banks in the United States in terms of assets, lending and market valuation, but the fund reduced that position to 535,000 shares by the end of the first quarter. The hedge fund had a sizable position in WFC at this point last year, but substantially reduced its WFC shares during Q2 of 2011. This year, it reduced its WFC shares during Q1, but may have continued to sell off shares during Q2.

Though down about seven percent over the last month, WFC has held up better than most large U.S. financials during that term. Shares are still up about 15 percent since the start of the year.

Westport Innovations (NASDAQ:WPRT)

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Soros Fund Management had developed a significant position in Westport Innovations, an Auto Parts company that provides technology that enable gasoline and/or diesel powered vehicles to convert to natural gas. The hedge fund reduced its holdings in WPRT from 3,228,063 shares at the end of 2011 to 2,995,606 shares at the end of Q1 2012. This position is still somewhat sizeable, representing around 5.5 percent of the company.

Westport has gone through a wild ride so far in 2012, appreciating approximately 50 percent during the first quarter, only to then substantially decline and now be down over 27 percent since the start of the year. Given the hedge fund's somewhat minor reduction to its position in WPRT, amounting to less than ten percent of its total position, it appears that Soros Fund Management may have merely been taking some profit at an opportune moment rather than actually exiting what appeared to be an investment for the longer term.

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

Disclaimer: This article is intended to be informative and should not be construed as personalized advice, as it does not take into account your specific situation or objectives.