Every quarter, many money managers have to disclose what they've bought and sold, via "13F" filings. Their latest moves can shine a bright light on smart stock picks.
Today let's look at investing giant John Paulson. Founded in 1994 and owned by its employees, Paulson & Co. has specialized in merger arbitrage, among other things, profiting when one company buys or merges with another (or merely announces plans to do so). It has grown into one of the largest hedge fund companies in the world.
Is Paulson really worth paying attention to, though? Very much so. According to the folks at GuruFocus.com, Paulson gained about 263% over the past 15 full years, compared with just 124% for the S&P 500. He more than doubled the market's return over the past five and 10 years as well. That certainly gets my attention.
The company's reportable stock portfolio totaled $12 billion in value as of June 30, 2012. Its biggest holding by far is the SPDR Gold Trust, with 28% of assets. Other gold properties bring the overall gold total to 44% of the company's overall assets. Gold hasn't been the best investment lately, though, delivering its worst results since 2008 over the past quarter.
So what does Paulson's latest quarterly 13F filing tell us? Here are a few interesting details:
New holdings include Equinix
Among holdings in which Paulson increased its stake was another gold position, NovaGold Resources
Paulson reduced its stake in a handful of companies, including private equity and venture capital specialist American Capital
Finally, Paulson unloaded several companies entirely, such as Walter Energy
Printing company Quad/Graphics, meanwhile, has been hurt by a shift toward digital publications from print. It has been losing money in recent years, yet still initiated (and then increased) a dividend, for some reason, and a hefty one at that, recently yielding 6.7%. In its recently reported second quarter, revenue was down a bit, but debt was down and cash from operations rose.
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. 13-F forms can be great places to find intriguing candidates for our portfolios.
And if you're intrigued by Equinix and the potential of Big Data, check out our free report, "The Only Stock You Need to Profit From the NEW Technology Revolution," which reviews a company that has gone on to gains of more than 200% since first recommended by the Fool. Best of all, it still has room to run. You can click here to access your report -- it's totally free.
Longtime Fool contributor Selena Maranjian, whom you can follow on Twitter, owns shares of Amazon.com, but she holds no other position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of Amazon.com. Motley Fool newsletter services have recommended buying shares of Amazon.com. The Motley Fool has a disclosure policy.