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Hedge Fund Ownership Review Q4 2012: Apple continues to fall out of favor

Feb 21, 2013

The 50 largest hedge funds increased their equity exposure by nearly 6% in Q4 2012. However, a number of concentrated positions were sold over the quarter, most notably Apple Inc. The funds reduced their holding from 1.9% of shares outstanding to 1.3% in Q4, and Apple represented the largest individual equity sale in six of the fifty hedge funds. While Apple is still the most-represented, top equity holding of the 50 largest hedge funds, the number of funds which list Apple as the top equity holding has declined from 12 to 6 in just one quarter.

Apple wasn’t sold by all funds though. In fact, the stock was even listed as the largest purchase of one fund: Appaloosa Management LP (which is one of the six funds to list Apple as the top equity holding). LyondellBasell Industries experienced the next largest decline in holding value over the quarter. While it was the top sale of two hedge funds, the primary reason for its decline in the aggregate portfolio of the hedge funds was due to two public equity offerings held by Apollo Capital Management that amounted to 41 million shares.

At the country-level, the top 50 hedge funds continued their home country bias by adding primarily to U.S. equities. Stocks domiciled in the Netherlands, on the other hand, received the largest decline in country exposure. But this was primarily due to Apollo’s liquidation of LyondellBasell Industries. On the sector-level, the top 50 hedge funds added the most exposure to their overweight position in the Consumer Discretionary sector by making large purchases in Time Warner Inc., News Corp., Comcast Corp. and Netflix Inc. (the Financials sector actually showed the largest increase in exposure, but this was primarily due to the Realogy IPO).

Read more about the ownership trends of hedge funds in this quarter's edition of FactSet Hedge Fund Ownership Quarterly. Visit www.factset.com/hedgefund_ownership to launch the latest report. 

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