The hedge-fund investor who has beaten Warren Buffett by 200x likely made a killing on Tesla


Renaissance Technologies, added more than 3 million shares of Tesla to its holdings in the fourth quarter of last year, as the electric-vehicle maker’s shares catapulted higher, according to public filings.

The hedge fund founded by James Simons, considered the premiere quantitative-driven investor, owned 3.9 million shares of Tesla at the end of Dec. 31, with the company’s stake in Renaissance’s portfolio jumping from 0.1% in the prior quarterly period to 1.3%, according to file-tracking site Whalewisdom.

The purchases would have come as Tesla’s shares

TSLA, +6.88%

were zooming higher, punishing a number of investors with short positions who had bet that the Elon Musk-run Silicon Valley darling would see its price collapse soon. Instead, Tesla’s shares have surged 142% in the past three months and has more than doubled since the beginning of 2020, according to FactSet data.

By comparison, the Dow Jones Industrial Average

DJIA, +0.40%

has gained 4.2% over a three-month period, and 2.4% so far this year, while the S&P 500 index

SPX, +0.47%

has climbed 7.9% in the past three months and 4.2% in the year to date. The technology-laden Nasdaq Composite

COMP, +0.87%

 has advanced nearly 14% in the past three months and boasts a 8.3% gain in 2020 so far.

By some reckonings, Simons is one of the most famous quantitative traders ever. He retired from the firm’s day-to-day operations of Renaissance a decade ago, but is still involved with the firm.

For his efforts, he ranks No. 21 on the Forbes list of the wealthy, with a net worth of $21.6 billion.

Renaissance’s main investment offering is the flagship Medallion Fund, which has generated a 39% average annual return from 1988 to 2018, that is despite rich fees, which currently include a 5% management and 44% performance fees.

Those costs haven’t prevented Medallion from outperforming Warren Buffett’s Berkshire Hathaway

BRK.A, +1.25%

BRK.B, +1.09%

 over the same 30-year period writes Nick Maggiulli of Ritholtz Wealth Management.

The Medallion Fund limits its assets to roughly $10 billion and is only available to Renaissance employees.

For its part, Tesla completed a $2 billion secondary offering on Friday and analysts have continued to hold a bullish view on the company. Bernstein analyst Toni Sacconaghi nearly doubled his price target, describing the vehicle maker as the “ultimate ‘possibility’ stock.” Sacconaghi raised his price target to $730, which was still below current levels at $845, from $325. “Revenue in 2020 is expected to rise by 30.3% to approximately $32 billion, and earnings are forecast to rise to $8.68 per share from $0.20 per share in 2019,” Whalewisdom researchers wrote.

Beyond Renaissance Tech, JPMorgan Chase & Co.

JPM, +1.36%

was seen purchasing roughly 2.2 million shares of Tesla in the most recent period, bringing its position to 2.5 million, according to Whalewisdom data.



Original source link

Oracle employees call on Larry Ellison to cancel Trump fundraiser


Upset Oracle Corp. employees are calling on Larry Ellison to cancel an upcoming fundraiser he’s hosting for President Donald Trump.

“We are disappointed that Oracle founder and CTO Larry Ellison’s support of Donald Trump does not affirm Oracle’s core values of diversity, inclusiveness, and ethical business conduct,” a group calling itself “Oracle Employees for Ethics” said in an online petition, which has accumulated more than 2,500 signatures as of Tuesday night.

Ellison is scheduled to host the fundraiser Wednesday at his estate in Rancho Mirage, Calif., according to news reports. The event will offer a golf outing and photos with Trump for $100,000, and photos, golf and a round-table discussion with Trump for $250,000, the Palm Springs Desert Sun reported.

In the petition, the employees said Ellison’s support hurts Oracle’s brand and staff morale, and misrepresents the company’s “diverse views.”

Ellison’s financial support “endangers the well-being of women, immigrants, communities of color, the environment, LGBTQ and trans communities, disabled people, and workers everywhere,” they said, and “his alliance with this ignoble and destructive figure damages our company culture as well as our relationships with partners and customers.”

The fundraiser is one of the biggest shows of support for Trump yet from Silicon Valley, and comes about two weeks ahead of the March 3 “Super Tuesday” primaries in California and 13 other states, as well as American Samoa.

Last week, the Desert Sun reported that while the billionaire Ellison has donated about $9.5 million to political causes since 1993, he has never donated to Trump’s campaign, at least as of the end of 2019.

Oracle shares

ORCL, -0.04%

  are up 4.6% year to date, compared to the S&P 500’s

SPX, -0.29%

  4.3% gain.



Original source link

Oil prices slide as investors fret about


Oil futures traded sharply lower Tuesday as concerns about the coronavirus and its impact on demand resurfaced, fueling a broader aversion to assets considered risky on Wall Street. Growing doubts that a group of global crude producers, particularly Russia, are inclined to reduce output further to stabilize prices also weighed on prices.

West Texas Intermediate crude for March delivery

CLH20, -1.86%

 lost $1.11, or 2.1%, to $50.94 a barrel on the New York Mercantile Exchange, while April Brent crude

BRNJ20, -2.05%

 fell $1.33, or 2.3%, to $56.34 a barrel on ICE Futures Europe.

“The risk-off tone was also driving oil on Tuesday, with WTI and Brent crude prices off by between 1.5%-1.8% amid fading hopes that OPEC and its allies will be able to agree to emergency production cuts to counter the deteriorating demand outlook,” wrote Raffi Boyadjian, senior investment analyst at XM in a Tuesday research note.

The decline comes after both grades last week booked their first weekly gains in six weeks, with WTI notching a 3.4% weekly rise, while Brent, the global benchmark, saw a 5.2% gain over the period, according to Dow Jones Market Data.

Crude oil traders have been waiting for signs that members of the Organization of the Petroleum Exporting Countries and other major producers like Russia — a group known as OPEC+ — will move forward a planned March meeting to sometime this month. However, Reuters, citing unnamed sources, reported that there are no indications that such a gathering will take place, heightening fears that the there isn’t sufficient will to dial back production further, in line with an advisory panel’s recommendation to shrink output by a further 600,000 barrels per day.

Russia, one of the largest exporters of crude, has been reluctant to reduce oil output further. OPEC+, is currently under an agreement to cut oil output by 1.7 million barrels per day, which ends at the end of March.

The slump in oil prices comes as the outbreak of COVID-19, the infection that reportedly originated in Wuhan, China last year, has sickened more than 72,000 people and killed more than 1,800, according to the most recent data out of China.

Commodity investors are concerned about the spread of the disease because it is expected to harm demand from China, the biggest importer of crude in the world. Infections elsewhere in the world could also harm global uptake of fossil fuels, producing a drag on prices.

Indeed, the International Energy Agency slashed its 2020 oil demand-growth forecasts by 365,000 barrels a day, a reduction of 30% to its previous forecast made in January, citing the impact of the outbreak of the novel coronavirus.

In other energy trading, March gasoline

RBH20, -0.20%

 was down 0.4% to $1.578 a gallon, after gaining 3.9% for the week, while March heating oil

HOH20, -2.11%

 lost 2.1% to $1.662 a gallon, following a 3.3% advance last week.

March natural gas

NGH20, +5.72%

 soared 5.9% to $1.945 per million British thermal units. The commodity suffered a loss of 1.1% for the week, and hit its lowest trade since March 2016.



Original source link

European chip stocks tumble on Apple warning, while HSBC slumps on profit slide


European stocks came under pressure on Tuesday, with chip makers heading south after Apple warned it will miss its quarterly revenue target due to coronavirus fallout, while shares of HSBC slid as it announced a profit slump and suspension of buybacks.

The Stoxx Europe 600 index

SXXP, -0.43%

 fell 0.5% to 429.64, a day after marking a fresh record close of 431.98, a gain of 0.3%. The German DAX 30 index

DAX, -0.64%

 dropped 0.7%, while the French CAC 40 index

PX1, -0.41%

 fell 0.5% and the FTSE 100 index

UKX, -0.71%

 slipped 0.5%.

U.S. stock futures were under pressure, with S&P 500 futures

ES00, -0.39%

 down 0.5%, while tech-heavy Nasdaq-100 futures

NQ00, -0.77%

 sliding around 0.9%. The Nikkei 225

NIK, -1.40%

 dropped over 1%, while Korea’s KOSPI

180721, -1.48%

 tumbled 1.4%.

In a warning that came while Wall Street was closed for the Presidents Day holiday, Apple

AAPL, +0.02%

 said it was unlikely to meet its revenue target for the quarter ending in March, triggering a more than 3% drop in premarket trading of shares, and losses across global equities. Apple said production among its suppliers in China is ramping up slowly after an extended Lunar New Year break to stem the spread of the virus.

In the chipmaking space, shares of Dialog Semiconductor

DLG, -5.05%

and ASM International NV

ASM, -4.49%

 slid around 5% each, while AMS

AMS, -2.42%

 fell around 4%.

Investors are also waiting for the ZEW economic sentiment index out of Germany for February for economic sentiment in Germany and the eurozone due to the coronavirus outbreak. China reported 1,886 new coronavirus infections and 98 deaths as of Tuesday. However, the Chinese Centers for Disease Control and Prevention published a study Monday showing that 80% of those infected suffered only mild illnesses.

Banks were the biggest losing sector in Europe, led by shares of HSBC

HSBC, -0.71%

HSBA, -6.40%

 dropped over 5% after Europe’s biggest lender said it would cut 35,000 jobs and strip out $100 billion in assets in a move to scale back Europe and U.S. operations as 2019 profit slumped 53%. HSBC also said its dividend would be suspended for this year and 2021 due to the costs of its restructuring.

Italian stocks were bucking a weaker trend, with the FTSEMIB Italy index

I945, +0.44%

 rising 0.1% thanks to a 26% rise in shares of Unione di Banche Italiane SpA. UBI Banca

UBI, +21.77%

 received a surprise offer from larger peer Intesa Sanpaolo SpA on Monday night to buy the Italian lender. Intesa Sanpaolo

ISP, +1.71%

 shares rose 1.4%.



Original source link

Who owns your company? NMC investors in London are finding out the hard way


Website of B.R. Shetty

Bavaguthu Raghuram Shetty meeting the U.K. ambassador to the U.A.E., Patrick Moody

The crisis unfolding at NMC Health, the Middle East’s largest hospital operator, has reignited the debate about the governance of overseas companies listing in London.

The mystery of NMC’s ownership structure deepened on Monday after founder and co-chairman Bavaguthu Raghuram Shetty quit the board of the FTSE 100-listed company over concerns that he misreported his stake.

Since Friday, four board directors have resigned, including chief investment officer Hani Buttikhi and non-executive director Abdulrahman Basaddiq, who joined under a relationship agreement between the company and principal shareholders Shetty, Saeed Al Qebaisi and Khaleefa Al Muhairi. As a result, NMC

NMC, +3.23%

said it did not consider Basaddiq to be independent.

“The saga at NMC Health continues and so does the suffering of its shareholders. The whole affair is turning into one of the worst stock market disaster stories of recent times,” said Russ Mould, investment director at stockbroker AJ Bell.

“It will raise serious questions about how corporate governance issues and overseas listings are handled by the regulators. After all, the private healthcare operator is not some pie-in-the-sky small cap. It is, for now at least, a FTSE 100 company. Sadly it is not acting like one,” Mould added.

Shares in NMC were up 1.42% at 13:00 GMT.

As the U.K. vies for scarce new company listings, the London Stock Exchange and listings regulators must not sell out their governance standards in the name of competitive advantage.

There was justifiable disquiet when the listing authority proposed watering down its rules in an effort to woo Saudi Arabia’s national oil company, Aramco. But regulators and investors should remember the lessons learned from losses of the past, when rules were weakened.

NMC joined the London Stock Exchange in 2012 and was promoted to the prestigious blue-chip FTSE 100 index in 2017, giving it access to a deep pool of investors and the respectability needed with western investors.

To be included in the FTSE 100, companies have to have a “premium listing” and are subject to stringent corporate governance rules, including giving minority shareholders extra voting power on issues such as independent directors.

Premium listed companies must also maintain a free float – the number of shares in public hands – of at least 25%. The size of the free float matters as if the majority of shares are held by a close-knit group of founding shareholders, they can exercise undue influence over the board.

The current rules were tightened in 2013 after two high-profile boardroom disputes at Kazakh miner ENRC and Indonesian miner then known as Bumi left investors nursing heavy losses. At the time, the U.K. Listing Authority, which is part of the Financial Conduct Authority, had waived the usual governance requirements for these companies, allowing them to list less than 25% of their shares.

Companies in which one shareholder owns more than 30% are now required to have a “relationship agreement” in place to ensure they can operate independently from that shareholder.

The problems raised by a dominant shareholder’s influence surfaced again in 2017 when the FCA proposed creating a new “premium listing” category for sovereign-controlled companies. The category would have allowed Aramco, which had planned to list 5% or less of its equity, to skirt the full range of premium listing requirements designed to protect minority investors.

In the end, Aramco canceled the London leg of its IPO roadshow, raising just over $25 billion on the local Tadawul bourse in December.

But the fiasco at NMC shows that regulators need to do more to ensure high standards of regulation and corporate governance are being adhered to, and the City’s reputation is not at risk.



Original source link