| David Einhorn, Greenlight (Bloomberg) |
David Einhorn’s Greenlight Capital held its own in June — sort of.
The fund still lags the overall market. The Standard & Poor’s 500 stock index was roughly flat in June, but it returned 1.9 percent for the quarter and 2.7 percent for the year to date.
But the New York-based Greenlight’s eponymous flagship fund posted a loss of just 30 basis points for the month, which enabled it to remain in the black for the year, up 0.80 percent.
Consol Energy remains by far the fund’s best performer this year. The shares of the coal and natural gas company rose another 5.4 percent in June and have more than doubled just this year alone.
Greenlight’s big bet on gold also continues to pay off. It returned 9 percent in June and 23 percent in the first half of the year.
Fashion giant Michael Kors Holdings has had a mixed effect on the hedge fund, which cuts its position in the stock by 24 percent in the first quarter. The shares surged 15.6 percent in June but fell 13 percent in the second quarter.
Greenlight also enjoyed a nice boost from several new positions it took in the first quarter. Real estate investment trust American Capital Agency Corp. returned 6 percent in June and is up nearly 10 percent for the second quarter. Hatteras Financial Corp., another REIT, rose nearly 5 percent last month and 18 percent in the quarter. Yelp, a website used to search for and review local businesses, gained 16 percent last month and about 52 percent for the quarter.
Greenlight also did well with its bet on natural gas futures, which it highlighted in its first-quarter letter to investors. Natural gas prices alone increased about 28 percent in the quarter.
On the other hand, Greenlight was especially hurt by its largest U.S. equity long holdings.
Apple, Greenlight’s largest position at the end of the first quarter, accounting for 15 percent of its U.S. long book, fell 4.2 percent in June and was down near 12 percent for the second quarter. General Motors Co., Greenlight’s second-largest long equity position, accounting for 8 percent of those assets, fell 8.4 percent in June and was down 8.8 percent in the second quarter.
Time Warner, Greenlight’s third-largest long, slid 2.8 percent in June but was up nearly 2 percent for the quarter. Shares of AerCap, the aircraft leasing giant and Greenlight’s fifth-largest stock long, was down 14 percent in June and down 13.3 percent for the quarter.
It is not very clear how Greenlight’s short book fared. Its so-called bubble basket of stocks declined by 13 percent in the first quarter. We don’t know exactly which stocks now constitute that collection of short positions.
Greenlight’s two known short bets produced mixed results. Pioneer Natural Resources, which Einhorn famously dubbed the “mother fracker” stock, fell 5.7 percent in June but gained 7.5 percent for the quarter.
On the other hand, AthenaHealth, the healthcare management software maker, added 8.8 percent in June but was down less than 1 percent in the quarter.
