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 Bridgewater Associates, representing the world's largest hedge fund -- and, in 2010 and 2011, the best-performing hedge fund, as well. Bridgewater was founded by Ray Dalio, who focuses on macroeconomic factors as he makes his investment decisions -- factors such as inflation, currency exchange rates, and GDP growth. He's clearly rather skilled, as the size of Bridgewater attests.
It can be hard to find sufficient promising places to park your money when you have so many billions to invest, but Bridgewater partly solves that problem with index funds, recently holding about 42% of its value in the S&P 500 SDPR ETF and 21% in the Vanguard Emerging Markets Stock ETF. The overall value of reportable assets, as of March 31, 2012, was $6.4 billion, although when you include other assets that the fund didn't have to report, Bridgewater had more than $70 billion in total assets under management as of the end of 2011.
So what does Bridgewater's latest quarterly 13F filing tell us? Here are a few interesting details:
New holdings include Weyerhaeuser
Among holdings in which Bridgewater increased its stake was networking and storage specialist Brocade Communications
Bridgewater reduced its stake in lots of companies, including Walgreen
Finally, Bridgewater unloaded several companies, such as Halliburton
Fools are divided on whether it's smart to buy coal stocks or sell coal stocks. With Arch Coal, bulls like the fact that coal is still crucial to our economy and Arch's metallurgical coal serves the steel industry, which will eventually recover, along with the global economy. Meanwhile, bears worry about coal eventually being overtaken by alternative and renewable energy sources and note that much of Arch's business comes from China, where growth seems to be slowing.
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. 13F forms can be great places to find intriguing candidates for our portfolios.
If industrial stocks interest you, check out our special free report, "3 Stocks to Own for the New Industrial Revolution," which details a new technology that might shift the "Made in China" trend back toward "Made in America."