Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



George Soros Invested in Dry Ships and Diana Shipping, but Should You?

George Soros' investment firm recently purchased 590,278 shares of DryShips (NASDAQ: DRYS  ) and 77,942 shares of Diana Shipping (NYSE: DSX  ) . That comes out to a $1.8 million stake in DryShips and an $841,000 stake in Diana Shipping. Soros' firm currently manages right around $6.8 billion spread across 2,333 holdings, so these additions are a very small portion of the total portfolio. The firm also owns small positions in Navios Maritime Holdings and Navios Partners.

Whether it's Soros himself or his fund managers, it appears his company is making a small bet on the dry bulk shipping sector, with DryShips and Diana Shipping leading the pack. So just what would motivate Soros to invest in this sector?

Some history on Soros' motivations for speculating
Looking at
Soros' biography in Money Masters of Our Time by John Train, Soros is known as a speculator by nature, with an ability to trade in and out of positions quickly using margin debt. His strategy revolves around three main points, according to Train:

  1. Start small, and then if things work out, build the position bigger.
  2. He doesn't need to know everything about a particular investment, just enough to have an edge on the market.
  3. He has to correctly judge the risk inherent in a position the moment it's established. 

But why is he investing in dry bulk shipping?
It appears from the first point that Soros' firm may be building an initial position, with the potential to add later if the strategy seems to be working. This strategy is most likely centered on a predicted shipping rate rebound in 2014 and 2015, 

Nonetheless, speculating on exactly why Soros' firm is investing in DryShips and Diana Shipping isn't the best use of time in this case. For investors, a quick look at Soros' methodology shows he's a macro-trader by nature, with a propensity to enter and exit large positions quickly. Soros' firm is probably investing in multiple companies to try to speculate on a industrywide rebound.

Final takeaway
In the following video, Motley Fool analyst Blake Bos takes an in-depth look at Soros' top two dry bulk holdings, DryShips and Diana Shipping, and tells investors whether he thinks it's a good idea to follow suit and invest in these two shippers as well.

With the market at all-time highs, high-quality dividends could be your safest bet
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notability of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.


Read/Post Comments (2) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 27, 2013, at 9:54 AM, Lou1s wrote:

    Would have been an interesting article to read.

  • Report this Comment On November 29, 2013, at 9:05 AM, Rdavis2035 wrote:

    Fidelity owns over 43 million shares of VTG, a owner of drill ships and rigs. VTG is a better buy than DRYS....

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2744424, ~/Articles/ArticleHandler.aspx, 9/30/2016 9:39:24 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 23 minutes ago Sponsored by:
DOW 18,308.15 164.70 0.91%
S&P 500 2,168.27 17.14 0.80%
NASD 5,312.00 42.85 0.81%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/30/2016 3:59 PM
DRYS $0.45 Up +0.01 +1.86%
DryShips CAPS Rating: **
DSX $2.62 Up +0.01 +0.38%
Diana Shipping CAPS Rating: ****