NEW YORK, Jan. 2, 2007 (PRIME NEWSWIRE) -- 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, which collectively 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.
Gilder Gagnon & Howe scores highly for its gains of about $885 million in 2006 from bets on Research in Motion Ltd., which has seen its share price soar from the $70s in March to $130s today. Gilder Gagnon & Howe wisely held on, through Research in Motion's much-publicized patent lawsuit, when other investors bailed out. It's now reaping the rewards of that decision.
Also topping Hedge Fund Trades' annual list was Pequot Capital Management's investment in biotech firm New River Pharmaceuticals. The Westport, Conn.-based hedge fund stands to profit to the tune of $105 million, thanks to the recent U.S. Food & Drug Administration approval of the Radford, Va.-company's drug treatment for attention deficit/hyperactivity disorder. Pequot's gain is all the more impressive for coming in a few weeks at the end of the year.
The full list of the seven top hedge fund trades of the year is available to journalists by contacting (415) 439-6666. To subscribe to Hedge Fund Trades, call (866) 291-1800, or go to: http://diversifiedmarkets.dowjones.com/products/prod_hft.html.
Hedge Fund Trades is delivered via email every Monday by 7 a.m. ET and is read by leading hedge fund managers, prime brokers, institutional investors, mutual fund managers and other market participants who want detailed coverage of current hedge fund transactions, analysis of completed investments, and an overview of opportunities managers are taking advantage of today in order to profit tomorrow.
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