Here's What Hedge Funds Bought in Q1
Nvidia, Druckenmiller, an options-trading sovereign wealth fund, and more
With another 13F deadline past us, retail investors are now able to view the equity and options positions of hedge funds as of the end of Q1. Hedge funds are required to submit a 13F 45 days after the end of each quarter.
The latest batch of Form 13Fs revealed several noteworthy trades, such as Stanley Druckenmiller selling 71% of his Nvidia NVDA 0.00%↑ position and Warren Buffett disclosing his secret holding as Chubb CB 0.00%↑, an insurance company. The 13Fs also revealed a set of peculiar options trades from a sovereign wealth fund, but more on that later.
Let’s first take a look at the Tiger Cubs, the most well-known group of hedge funds on Wall Street.
Tiger Cubs 13F Activity
For the Tiger Cubs, Amazon AMZN 0.00%↑ was the only holding with an ownership rating of 100% while Nvidia commanded the highest average portfolio weight of 10.53%.
Among the Nvidia holders, Coatue, Light Street, and Matrix decreased their positions by 68%, 21%, and 20%, respectively, while Maverick increased its position by 6%. Tiger Global kept its stake unchanged.
Based on my overview of the 50+ hedge funds that I track, it’s clear that the Q4 buying spree of Nvidia did not continue into Q1. Other hedge funds outside of Tiger Cubs that reported large NVDA sales include Baillie Gifford, D.E. Shaw, and Point72.
On the other side of the trade was Alex Sacerdote’s Whale Rock, which increased its NVDA stake by 62%, cementing the company as its largest position. Whale Rock also added new stakes in Micron MU 0.00%↑, Marvell MRVL 0.00%↑, and Coherent COHR 0.00%↑.
Instacart CART 0.00%↑ stands out like a sore thumb on the list. Every other company, except Workday WDAY 0.00%↑ with its $65 billion market cap, has a market cap of at least $150 billion. Dan Sundheim’s D1 Capital has 16.4% of its 13F portfolio invested in CART, although this is attributed to the hedge fund investing privately before the Instacart IPO.
The grocery delivery company caught my eye last quarter due to its high Tiger Cub ownership, although I decided to pass on investing after conducting my own research. That was a mistake, as CART is up by 37% YTD.
Taiwan Semiconductor TSM 0.00%↑ is an interesting pick as well due to the risk of a Chinese invasion of Taiwan. However, its consensus rating of 62.50%, the same as Nvidia, makes it clear that the group believes that this scenario will likely not happen in the near-term. TSM’s 51% YTD return backs that up.
Stanley Druckenmiller - Duquesne Family Office
Total Positions: 73
Top 5 New Positions: IWM calls, COHR, DFS, KMI, WAB
Top Buys: IWM calls (notional, not nominal), COHR, NTRA, WWD, DFS
Top Sales: NVDA, NVDA calls, LLY, VRT, UBS
Average 13F Holding Period: 2.29 quarters
In April, Druckenmiller announced on CNBC that he had reduced his Nvidia position:
“We did cut that position and a lot of other positions in late March. I just need a break. We've had a hell of a run. A lot of what we recognized has become recognized by the marketplace now.”
It turned out to be a pretty significant reduction, as his 13F revealed that he sold 71% of his stake in the chip maker as well as all of the NVDA calls he bought in Q4. In fact, Duquesne completely sold out of 21 positions:
It wasn’t all doom and gloom, though. The family office’s total market exposure increased to $4.39 billion from $3.35 billion quarter-over-quarter while Nvidia is still its 7th largest position following the sale.
In the same CNBC interview, Druckenmiller said “I will be very surprised if I don’t own Nvidia on and off next 10 years,” and “we’re as bullish on AI as we’ve ever been.”
“Well, first of all, I wasn’t early with Nvidia. My young partner was early with Nvidia. He called me in the fall of ’22 and said that he thought all this excitement about Blockchain was going to be far outweighed by AI. And I asked him how to play it and he told me I should buy this company Nvidia. I didn’t even know how to spell it. I bought it. Then, a month later, ChatGPT happened. Even an old guy like me could figure out, okay, what that meant. So I increased the position substantially. I said in an interview in June of that year that I expected to own Nvidia for two or three years, that this was a mega trend like I’d never seen, potentially bigger than the Internet. But when the stock went from 150 to 900, I’m not Warren Buffett. I don’t own things for 10 or 20 years. I wish I was Warren Buffett. And 150 to 900, yes, we did.”
Druckenmiller, April 2024 CNBC Interview
The seasoned fund manager also picked up COHR, a new semiconductor investment, making it his 8th largest position.
Meanwhile, Druckenmiller’s largest position, by notional value, not nominal, is IWM calls. These calls tally in as his #1 position when considering the leveraged nature of options (notional value) rather than the actual amount invested (nominal value).
Still, the calls signal Druckenmiller’s near-term bullish stance on small-cap companies, which could possibly be a bet on falling rates and economic expansion.
Hedge Funds Up Their Bets on China
David Tepper’s Appaloosa is perhaps the biggest China bull on Wall Street. The hedge fund’s 13F AUM tallies in at $6.75 billion, of which 25% consists of Chinese stocks in the form of BABA, PDD, BIDU, FXI, KWEB, TSM, and BEKE.
Appaloosa
Total Positions: 39
Top 5 New Positions: ADBE, FXI, JD, KWEB, MSFT puts
Top Buys: BABA, ADBE, PDD, FXI, BIDU
Top Sales: UBER, META, NVDA, ARK calls, MSFT
Average 13F Holding Period: 8.21 quarters
Alibaba is now Tepper’s largest position at 12.05%, moving up from #6 in Q4. As with Druckenmiller, Tepper also reduced his NVDA position by a significant amount.
Michael Burry’s Scion Asset Management has also emerged as a major China bull. The fund manager’s largest position is JD at 9.53% followed by BABA at 8.74%. Across Scion’s 16 position portfolio, Burry is invested in 3 Chinese stocks (the other is BaiduBIDU 0.00%↑) with a 13F allocation of 22%.
At the same time, Burry’s short average 13F holding period of 1.75 quarters makes it difficult for long-term investors to empathize with his investments, although they are still widely discussed and featured in the media.
Scion Asset Management
Total Positions: 16
Top 5 New Positions: PHYS, CI, BP, FSLR, BIDU
Top Buys: PHYS, CI, BP, FSLR, JD
Top Sales: ORCL, CVS, NXST, GOOGL, AMZN
Average 13F Holding Period: 1.75 quarters
Chinese stocks have surged in recent weeks, with FXI, the iShares China Large-Cap ETF, up by 19% during the past month and 25% YTD. That’s more than double the S&P 500’s YTD return of 12% and is nearly double the Nasdaq 100’s return of 13%. It’s fair to say that Tepper and Burry’s Chinese bets have paid off.
Among all 13F filers, net exposure to FXI increased by 12.44% QoQ, while total filers increased by 9.96% to 254.
Brad Gerstner - Altimeter Capital
Total Positions: 17
Top 5 New Positions: CPNG, DELL, AVGO, GOOGL, ALAB
Top Buys: TSLA, CPNG, DELL, AVGO, AMZN
Top Sales: SNOW, CFLT, META, PDD, VDA
Average 13F Holding Period: 6.71 quarters
Altimeter’s Brad Gerstner bought Tesla TSLA 0.00%↑ for a second time in Q4 of 2023 after selling out of his first batch of shares in Q4 of 2022. Gerstner had even owned puts against the EV company in 2017 and 2018:
Gerstner noted that he reinvested in TSLA after having a “ChatGPT moment” with the company’s Full Self-Driving (FSD) service.
“Why is that? Because they totally scrapped their prior deterministic models and have moved to an imitation learning model that really, for the first time — unlike Waymo, which is still a deterministic model — feels like a human driving the car.”
“He’s (Elon Musk) got 5 million robot cars on the road collecting data that’s training this imitation model that makes it demonstrably better and almost impossible for all the traditional OEMs to replicate.”
-Brad Gerstner in a March CNBC interview
As with Whale Rock and Duquesne, Altimeter also disclosed a new position in COHR.
Saudi Arabia’s PIF Begins Trading Options
Saudi Arabia’s Public Investment Fund (PIF) submitted an extremely unusual 13F. Just take a look at its top 25 positions:
Total Positions: 38
Top 5 New Positions: ARM calls, SBUX calls, BKNG calls, AMZN calls, ADBE calls
Top Buys: ARM calls, SBUX, calls, BKNG calls, AMZN calls, ADBE calls
Top Sales: META, XLU, LYV, CCL, APD
Average 13F Holding Period: 6.37 quarters
First, it’s worth pointing out that PIF actually owns more Lucid LCID 0.00%↑ than shown in the 13F, as it is also invested through a subsidiary, Ayar Third Investment. Its total ownership comes out to $1.65 billion shares worth $4.7 billion compared to its cost basis of $6.4 billion.
PIF’s new positions include calls on NVDA, AMD, ARM, AMZN, MSFT, META, and SBUX. This is the first time that PIF has ever disclosed ownership of options in its 13F portfolio, and it’s going at full speed. It’s worth noting that PIF’s doesn’t own a single put option.
That comes as the sovereign wealth fund sold completely sold out of 25 companies, slimming its portfolio down to 38 positions:
PIF’s 13F exposure fell to $20.6 billion from $35.2 billion. Some of that can be attributed to Lucid, its second largest position, falling by 31% in Q1. PIF owns a 60% stake in the luxury automaker and made its first investment in 2018. Lucid completed its SPAC merger in July of 2021 and has fallen by almost 90% since then. On the other hand, the fund’s long-term investment in Uber UBER 0.00%↑ has been a success.
PIF’s trades are extremely unusual given that it sold off so many positions while loading up on calls. This is likely attributed to the fund shifting its capital to other alternative investments, such as women’s tennis.
10 13F Filings From Top Hedge Funds
For the readers who prefer to just view 13Fs, here are 10 filings from top performing hedge funds:
Berkshire Hathaway - Warren Buffett
Total Positions: 41
Top 5 New Positions: CB
Top Buys: CB, LSXMK, LSXMA, OXY
Top Sales: AAPL, PARA, HPQ, CVX, LPX
Average 13F Holding Period: 23.2 quarters
SRS Investment Management - Karthik Sarma
Total Positions: 22
Top 5 New Positions: AMD, AAL, BURL, CFLT, PYPL
Top Buys: AMD, AAL, BURL, CAR, DDOG
Top Sales: META, STLA, SPOT, PDD, LAD
Average 13F Holding Period: 9.86 quarters
SCGE Management - Jeff Wang
Total Positions: 19
Top 5 New Positions: FTNT
Top Buys: NVDA, FTNT, SHOP, GLBE
Top Sales: META, CDNS, BZ, FRSH, ZI
Average 13F Holding Period: 11.58 quarters
Whale Rock - Alex Sacerdote
Total Positions: 45
Top 5 New Positions: CRM, APP, MRVL, TOST, MU
Top Buys: AMZN, CRM, NVDA, APP, MRVL
Top Sales: AMD, ZS, MNDY, ESTC, ON
Average 13F Holding Period: 6.42 quarters
Coatue Management - Philippe Laffont
Total Positions: 86
Top 5 New Positions: QCOM, AVGO, DELL, CEG, VST
Top Buys: TSM, CRM, QCOM, AVGO, PYPL
Top Sales: NVDA, AMD, NFLX, META, AAPl
Average 13F Holding Period: 7.9 quarters
Pershing Square - Bill Ackman
Total Positions: 7
Top 5 New Positions: None
Top Buys: None
Top Sales: LOW, CMG
Average 13F Holding Period: 22.57 quarters
TCI Fund Management - Chris Hohn
Total Positions: 10
Top 5 New Positions: None
Top Buys: GE, GOOGL, MCO
Top Sales: TMO, FERG, CNI, CP, MSFT
Average 13F Holding Period: 19.9 quarters
Dorsey Asset Management - Pat Dorsey
Total Positions: 10
Top 5 New Positions: None
Top Buys: AZO, SMR
Top Sales: META, HRI, GOOG, WIX, SMAR
Average 13F Holding Period: 14.6 quarters
Third Point - Dan Loeb
Total Positions: 40
Top 5 New Positions: GOOGL, SPGI, AAP, MRVL, GS
Top Buys: GOOGL, AMZN, SPGI, AAP MRVL
Top Sales: X, DD, MSFT, MCK, IFF
Average 13F Holding Period: 5.05 quarters
Peconic Partners - Bill Harnisch
Total Positions: 10
Top 5 New Positions: XLU, CCL, NEE, SO, FE
Top Buys: XLU, MU, CCL, DY, PWR
Top Sales: WCC, CLF, AMZN, GOOG, CNK
Average 13F Holding Period: 8.9 quarters
That’s a wrap for the Q1 2024 13F review. Thanks for reading, and see you for the next one!
Hedge Vision - Institutional Insights
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great take, thank you!