market folly

Atticus Capital has amended 2 separate 13G filings recently. In a 13G filed due to activity on July 31st, 2009, Timothy Barakett's hedge fund is now showing a 3.9% ownership stake in Sotheby's (BID) with 2,612,942 shares. They have decreased their position from a previous 5.4% stake when we covered their initial 13G filing on Sotheby's. That original disclosure was made due to activity on June 11th, 2009. So, in a little over a month, Atticus has sold 971,168 shares of BID.

In a second 13G filing made due to activity on July 29th, 2009, Atticus is also now showing a 2.4% ownership stake in Transatlantic Holdings (TRH) with 1,589,800 shares. This is a decrease from their previous 5.6% ownership stake reported when they filed their initial 13G on TRH in early June of this year. So, yet another position that Atticus has been selling down. Between June 8th and July 29th, Atticus sold 2,099,800 shares. To see what else Atticus holds, you can view the rest of their portfolio.

This is yet another development on the rollercoaster of a ride otherwise known as: "tracking Atticus' portfolio." In the past, we've detailed how Atticus has ramped up their portfolio, only to drastically scale it back... and then ramp it up again. These filings are the perfect illustration of that. They assembled large positions in both BID and TRH in early June and are already selling sizable pieces of their stake just over a month later. If you think about it, you can't really blame them as they will have locked in some nice profits over a short period of time. Still though, the whipsawing and rollercoastering is making us a bit seasick. Either things are still not quite totally stable over there after their rough 2008, or they are more concerned about locking in solid gains while they have them. Either way, the portfolio turnover game at Atticus plays on.

Atticus was ranked #2 on the Top 10 Asset Losers for 2008 in hedge fund land. And as we mentioned above, their portfolio has been all over the place. Over the course of 3 quarters, they've gone from selling a ton of long equities exposure one quarter, loading up on options positions the next, then most recently only reporting 5 material long equity positions. In two weeks time when the next round of 13F filings come out, one can only guess what their portfolio will look like next.

Timothy Barakett received both his BA in Economics and his MBA from Harvard. It's very evident that Barakett employs macro based investment theses. Once he has decided on what the trend is, he will find the best company within that trend and he will place a big bet. And, when needed, he will step in and take an activist role, ensuring the company is performing to his liking. A fun fact about Barakett is that he was a Harvard hockey teammates with Philip Falcone of Harbinger Capital Partners, whom we also cover.

Taken from Google Finance,

Sotheby's is "an auctioneer of fine art, antiques and decorative art, jewelry and collectibles. The Company’s operations are organized into three business segments: Auction, Finance and Dealer. In addition to auctioneering, the Company’s Auction segment is engaged in a number of related activities, including the brokering of private purchases and sales of fine art, jewelry and collectibles."

Transatlantic Holdings "conducts its operations principally through its three operating subsidiaries: Transatlantic Reinsurance Company (TRC), Trans Re Zurich (TRZ) and Putnam Reinsurance Company (Putnam). The Company offers reinsurance capacity for a range of property and casualty products on both a treaty and facultative basis. These products are offered directly and through brokers, to insurance and reinsurance companies, in both the domestic and international markets."

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