Photo: Linette Lopez for Business Insider
When the world’s top hedge fund managers speak, the market listens.If you need proof, we attended the Ira Sohn Investment conference in New York yesterday where hundreds of investors doled out $3,000 (for charity) to hear the best and brightest hedge funders share their investment views and picks.
What’s always fascinating about these exclusive conferences — where people on their laptops and iPads listen to every word being said onstage — is the intraday trading movements that take place once a hedge funder reveals his/her pick.
The trend seems to be that when a fund manager says he/she is long a certain stock, you’ll likely see an immediate spike in both the price and the trading volume in that particular stock.
Likewise, when a fund manager says he/she is short a stock, the price tends to tank and the volume spikes, too.
We’ve compiled some of the stock picks (both long and short) that were mentioned at yesterday’s event and we’ve also included the chart.
Shortly after 12:40 p.m., Larry Robbins, the founder of Glenview Capital Management, said that he's long hospital stocks. Look what happened to Tenet Healthcare Corp's stock price around that 12:40ish mark. Even the volume spiked.
Robbins then said he was short ITC Holdings, an electric transmission operation company, around 12:50 p.m. The stock price dipped around that time and volume jumped.
At 1:20 p.m., Dwight Anderson, the managing partner of Ospraie Management, a fund that focuses on various commodity markets and basic industries, said he really likes WestLake Chemical Corp. The stock didn't make it into positive territory, but volume moved up and the stock pared some earlier losses.
At approximately 1:40 p.m., Meryl Witmer, a general partner at Eagle Capital Partners, said her long pick was Gildan, a maker of fleeces, t-shirts and socks. Again, look how the stock price and volume ticked up.
Philippe Laffont of tech-focused Coatue Management recommended Virgin Media at around 2:49 p.m. There was an immediate spike in trading volume and the price surged.
Around 3:25 p.m., bond god Jeff Gundlach, the CEO of DoubleLine Capital, said he's shorting Apple because 'people aren't going to line up around the corner for 'iPhone 87.'
This is incredible. Around 3:40 p.m., hedge fund hot-shot David Einhorn slammed Martin Marietta Materials causing the company's stock to instantly tank 10%. Check out the volume, too.
Prior to the Ira Sohn conference, the rumour was that Einhorn was going to announce he was short Herbalife. That company's stock was already surging 9% before he spoke, but when he didn't name it in his presentation is really spiked to close more than 16% higher.
Around 3:50 p.m., Einhorn questioned Amazon on whether or not it does business better than its competitors. He said the company's future is riddled. The stock slipped into negative territory around this time and look at the spike in volume.
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