CYT helped drive Passport Capital in July. VIPS dragged
Passport Capital returns an estimated 1.01% for July 2015 - the fully hedged version returns 0.35%
John Burbank's Passport Capital generated a 1.01% return on their publicly disclosed long portfolio for the month ending July 2015, outperforming the S&P500 by 100 basis points (bp). On a hedged basis, the portfolio would have returned 0.35% StockAlpha over the same period. Passport Capital's StockAlpha reflects the return of the net return if each security in their portfolio was hedged with a sector ETF, such that the resulting portfolio was market, beta and sector neutral. StockAlpha in the Materials sector contributed the most to StockAlpha during the month.
Positive Contributors to Passport Capital's Returns
Passport Capital’s position in Cytec Industries Inc. (CYT) contributed the most to the performance of the manager’s long-portfolio during the month. Over the month of July 2015, Passport's 3.8% position in Cytec Industries Inc. (CYT) increased in value by 25.4%, contributing 0.97% (3.8%*25.4%=0.97%)to the long portfolios overall return. Looking at Passport's portfolio through a fully hedged StockAlpha lens, the holding of Cytec Industries Inc. (CYT) also provided the largest contribution to fully hedged returns. Cytec Industries Inc. (CYT) returned 25.4% during the month compared to the Materials sector, which returned -5%. As a result, after taking into account Cytec Industries Inc. (CYT)'s beta relative to its sector, the position contributed 1.1% of StockAlpha to the Passport’s monthly performance.
Negative Contributors to Passport Capital's Returns
Much of the drag on Passport Capital’s long-portfolio during the month can be attributed to the holding of Vipshop Holdings Ltd (VIPS). Over the month of July 2015, the manager's 10.7% position in Vipshop Holdings Ltd (VIPS) returned -9.4%, contributing -1.01% (10.7%*-9.4%=-1.01%)to the long portfolios overall return. Looking at Passport's portfolio on a fully hedged basis, one can isolate the StockAlpha. The holding of Vipshop Holdings Ltd (VIPS) also provided the most negative contribution to fully hedged returns. Vipshop Holdings Ltd (VIPS) returned -9.4% during the month compared to the Cons. Disc. sector, which returned 5%. As a result, the position contributed -1.7% of StockAlpha to the manager’s monthly performance.
Overlap with other hedge funds
Among Passport’s top 10 largest positions, Kraft Foods Group Inc. (KRFT) is the name that is owned by most other hedge funds. 16.1% of hedge funds within Symmetric's universe had a position in Kraft Foods Group Inc. (KRFT) as of March 31, 2015, making it neither a consensus nor contrarian. Passport initiated its position in Kraft Foods Group Inc. (KRFT) 0 years ago. Other hedge funds that have significant ownership stakes in Kraft Foods Group Inc. (KRFT) include Dynamo Internacional Gestao De Recursos Ltda. (17.8% position initiated 0 years ago), Permian Investment Partners Lp (15.9% position initiated 0 years ago) and Slate Path Capital Lp (13.4% position initiated 0 years ago). Overall, Passport's book is neither consensus or contrarian, with the average position held in the portfolio held by 10.5% of hedge funds. Use Symmetric to surface managers with unique sources of alpha and flag those that may be in trouble.
