Thursday, May 27, 2010

Latest Ideas From Some Heavy Hitters

By Eric Jackson
RealMoney Contributor

5/27/2010 5:00 PM EDT
Click here for more stories by Eric Jackson

Yesterday was the 15th annual Ira Sohn Research Conference in New York. The event brings together the best hedge-fund managers in the world to present their top ideas for the coming year. All proceeds from the event go to charity, supporting pediatric cancer and other childhood diseases.

The event has a stellar reputation, partly because of its track record of managers presenting ideas here for the first time publicly that go on to pan out exactly as they argue. In 2008, David Einhorn made a splash at this conference by pointing out some of the problems with Lehman Brothers -- four months prior to that firm's bankruptcy. At the 2007 conference, Bill Ackman called for the demise of Ambac (ABK - commentary - Trade Now) and MBIA (MBI - commentary - Trade Now), and last year he touted General Growth Properties (GGP - commentary - Trade Now) when the stock was under $4 -- it's now over $13. Some have called this conference the Learning Annex for hedge-fund managers.

Just an idea for the event organizers: There's such interest in the ideas from the event that they should consider live streaming the event on the Web. They could charge for it and likely still get a large audience that would further support their worthy cause.

Yesterday's roster of speakers was stellar as usual, including Ackman of Pershing Square, Einhorn from Greenlight, Sam Zell, David Tepper of Appaloosa and Seth Klarman of Baupost.

Many speakers, including Einhorn and Ackman, reiterated arguments they've made publicly, for example shorting the ratings agencies likeMoody's (MCO - commentary - Trade Now) andMcGraw-Hill (MHP - commentary - Trade Now) and going long General Growth. Other speakers, such as Niall Ferguson of Harvard and former auto-czar Steve Rattner, chose to stick to macroeconomic predictions.

David Tepper, who was bullish in 2008 and lost money, then stayed bullish in 2009 and made $4 billion, was still bullish yesterday. He pointed to the bleachers, a la Babe Ruth, and said that Bank of America (BAC -commentary - Trade Now) is going to $27. Tepper also likes AIG (AIG - commentary - Trade Now) and the beaten-down Spanish bank Banco Santander (STD - commentary - Trade Now).


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