Property, merger bets dominate picks at Sohn conference – Nasdaq

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Reuters


By David Randall and Svea Herbst-BaylissNEW YORK, May 8 (Reuters) - Shares in a real estate
developer, a cable company and the Canadian creator of the
Teletubbies show all rose on Monday after being promoted at an
event in New York where hedge fund managers present a diverse
range of investment ideas.
    The optimism on show among conference speakers marked a
change from last year, when several had expected slowing global
economic growth. A late 2016 equities rally however left the
average hedge fund performance lagging the broader market, and
speakers this year appeared keen to make up lost ground.
    Keith Meister, who runs $5.5 billion hedge fund Corvex,
revealed the fund's stake in data communications company
CenturyLink Inc <CTL.N>, which is merging with Level 3
Communications <LVLT.N>, sending CenturyLink shares up 4
percent.
    Shares in Toronto-listed DHX Media Ltd <DHXb.TO>, which owns
rights to popular children's television shows including Bob the
Builder and Teletubbies, jumped more than 7 percent after Debra
Fine, founder and president of Fine Capital Partners, announced
her position in the company and pegged its fair value at between
C$20 and C$30 per share.
    And billionaire investor William Ackman, head of Pershing
Square Capital Management, underscored his bullishness on Howard
Hughes Corp <HHC.N>, highlighting the real estate company's
attractive land holdings. His fund has owned the company since
2010 and is its largest investor, owning nearly 9 percent of the
company. Ackman is board chairman at Howard Hughes, which rose 4
percent in afternoon trading.
    Hedge funds were caught off guard by the surprise Election
Day victory of U.S. President Donald Trump in November, which
helped spark a more than 12 percent rally in the S&P 500 on the
possibility of lower taxes and less regulation. The average
hedge fund returned 7.5 percent from the start of May 2016
through March 2017, according to Hedge Fund Research,
approximately half the 14.4 percent gain in the benchmark S&P
500 index over the same time.
    The hedge fund industry had net outflows of $5.4 billion in
the first quarter of 2017, according to HFR. That followed $70.1
billion in outflows in 2016, the largest calendar year loss
since 2009, as public pension funds in states including New
York, Illinois and Rhode Island pulled money from hedge funds.
    Some of the people who spoke on Monday poked fun at
themselves for getting it wrong in a year of so many surprises.
Last year Stanley Druckenmiller, one of the industry's
best-known macro investors, had urged investors to buy gold
because he felt the stock market was overvalued.
    "I suggested get out of equities and buy gold. That's why
I'm introducing this year," said Druckenmiller, who used to work
for George Soros and is now a private investor.
    Kevin Warsh, a former Federal Reserve governor, was one of
the few bearish voices among the Sohn speakers. Calling himself
a worrier, Warsh warned central banks and institutional
investors looked unprepared should growth in the global economy
start to lag.
    "They need to be gaining credibility at this time of peace,"
Warsh said about his former central bank colleagues.
    For a table on investment picks from the Sohn conference,
see: [nL1N1IA14Y]

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
TABLE-Hedge fund managers' investment picks from Sohn conference
   [nL1N1IA14Y]
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 (Reporting by Svea Herbst-Bayliss, additional reporting by
Lawrence Delevingne, Sam Forgione and Michael Flaherty; Editing
by Meredith Mazzilli)
 ((svea.herbst@thomsonreuters.com; +617 856 4331; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))

Keywords: FUNDS SOHN/ (PIX)


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