The famed hedge fund manager George Soros, known for breaking the British pound in 1992, shocked the world on Friday by announcing a 7.91% stake in J.C. Penney (NYSE:JCP). The news sent shares of the ailing retailer sharply higher, making it the best-performing stock on the S&P 500 (SNPINDEX:^GSPC) that day.

Besides throwing J.C. Penney a much-needed lifeline in the equity markets -- its shares are down nearly 50% over the past year alone -- the move reaffirms one of Soros' central tenets: "The worse a situation becomes, the less it takes to turn it around, and the bigger the upside."

The stake, valued at $295 million, makes J.C. Penney the third largest holding of Soros Fund Management, the privately owned hedge fund that's largely responsible for managing its founder's wealth. It also adds to an increasingly diverse portfolio of stocks. Among the fund's other large holdings are companies as disparate as AIG (NYSE:AIG), Johnson & Johnson (NYSE:JNJ), and Google (NASDAQ:GOOGL):

George Soros' 10 Largest Stock Holdings | Create infographics

This is contrarian investing at its best -- and particularly Soros' three largest holdings, all of which have run into hard times over the past few years.

John Maxfield has no position in any stocks mentioned. The Motley Fool recommends and owns AIG, Google, and Johnson & Johnson and has options on AIG. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.