| David Einhorn, Greenlight Capital (Bloomberg) |
David Einhorn’s Greenlight Capital Fund enjoyed another strong month. As a result, the firm’s namesake long-short equity hedge fund is well on its way to enjoying a strong comeback year after suffering a more than 20 percent loss in 2015.
Greenlight followed a 1.2 percent gain in October with a 1.9 percent surge in performance in November. As a result, the hedge fund is up 7.7 percent for the year-to-date.
Most of Greenlight Capital’s largest positions were positive in November. In fact, its only major losses on the long side came from its big bet on gold.
The price of the metal — one of the firm’s largest disclosed long positions — fell about 6.6 percent for the month. Otherwise, Greenlight was led last month by the hedge fund firm’s biggest winners all year, most of which were established before 2015.
For example, shares of chemical company Chemours surged another 20 percent in November and are now up a whopping 360 percent for the year. Greenlight is the largest shareholder of the company created when it was spun off from DuPont in July 2015. Chemours was Greenlight’s sixth-largest U.S. long stock position at the end of the third quarter.
CONSOL Energy, a coal and natural gas company, jumped 21.4 percent in November and is up 160 percent for the year. It was Greenlight’s fourth-largest U.S. stock position at the end of the third quarter.
Media giant Time Warner was another major position for the firm that was a big winner in November, gaining 3.2 percent for the month. It is now up 42 percent for the year.
AerCap Holdings, the aircraft leasing company that is the hedge fund firm’s third-largest U.S. stock position, returned 4.2 percent in November. Meanwhile, shares of car giant General Motors, Greenlight’s second-largest equity long, surged 9.3 percent for the month and are now positive for the year, up 1.5 percent.
Greenlight’s only major long position to lose money in November was Apple. The iPhone maker, Greenlight’s largest equity holding, was down 2.6 percent in November, but is up 5 percent for the year.
Even one of Greenlight’s home run short positions was a big winner in November. Athenahealth, the healthcare computing services company, fell 8.4 percent in November, following an 18 percent drop in October, after reporting quarterly results that came in well below expectations. The stock is now down more than 40 percent for the year.
We don’t know which stocks comprise Greenlight’s so-called “bubble basket” of shorts. But it has identified Amazon.com several times in the past as one of those holdings. And in November the stock dropped another 5 percent.
Not all is rosy, however. Besides the setbacks in its gold investments, shares of Pioneer Natural Resources, Greenlight’s so-called “mother fracker” stock that Einhorn singled out as a short at an investment conference last year, rose 6.7 percent last month and is now up 52 percent for the year. However, there have been enough winners to more than offset the clunkers this year.
