Every quarter, many money managers have to disclose what they've bought and sold via 13F filings. They're also often interviewed, which offers peeks into their thinking and recent actions. Their latest moves can shine a bright light on smart stock picks.
Today let's look at Kynikos Associates, founded in 1985 by investing giant Jim Chanos, which sported a reportable stock portfolio of $118 million as of March 31, 2012. Chanos is known for being an early spotter of trouble at Enron, betting against it and profiting while others got crushed.
The company's top three holdings, representing 19% of total assets, were VMWare, the SPDR S&P Midcap 400 ETF, and Amazon.com.
So what does Kynikos Associates' latest quarterly 13F filing tell us? Here are a few interesting details:
First off, there were no new holdings. Kynikos made some bullish calls on the overall stock market, increasing its holdings of some popular ETF tracking the broader S&P 500 and MSCI emerging market indexes.
Kynikos Associates reduced its stake in several companies, including Rackspace Hosting
Kynikos also cut its stake in Apache
Finally, Kynikos Associates unloaded several companies, such as American Capital Agency
Invesco, meanwhile, recently yielded 14%. Some of its peers are funding dividends partly by issuing more shares, which dilutes shareholder value. Invesco, though, seems to be holding its share count relatively flat, which is good. It recently posted a rather strong quarterly report, boosting its net income, but its debt-to-equity ratio has risen sharply over the past year.
Chanos has shed some light on his vaunted shorting activity in recent interviews. For example, two stocks he's bearish on are Coinstar
We should never blindly copy any investor's moves, no matter how talented the investor. But it can be useful to keep an eye on what smart folks are doing, and 13-F forms can be great places to find intriguing candidates for our portfolios.