MSN MoneyCentral – Hedge Fund Trades, the premier weekly newsletter covering the trading activity of hedge funds, has come out in today’s issue with a list of seven top trades of 2006, whichcollectively racked up profits of $2.3 billion.
All the hedge funds highlighted in these top trades showed skill at picking stocks that were undervalued by Wall Street as well as trading acumen in maximizing their upside potential, according to the editors of Hedge Fund Trades, which is published by Dow Jones Financial Information Services. The staff of the newsletter reviewed more than 200 stocks traded by hedge funds and reported on over the course of 2006 and analyzed Securities and Exchange Commission filings and price histories of the stocks to come up with this list.
“Despite the repeated suggestions that too much capital is squelching hedge fund returns, our analysis found that select firms are still hitting home runs with astute trades,” said Nick Elliott, managing editor of Dow Jones Newsletters. “These big hits are what make certain funds stand out from the rest of the money management crowd and keep investors coming back.”
The top hedge fund trade of the year was Atticus Management LLC’s bet on copper-mining giant Phelps Dodge Corp. The New York-based hedge fund got the stock into its portfolio just in time to capitalize on copper prices hitting record highs. The firm is set to make at least $1.1 billion from the trade for 2006, or nearly double its investment in less than two years.
