Hedge Funds Financial

Hedge Funds Cut Financial Stocks

Hedge Funds Trim Financial Stock Before Huge Losses

John Paulson, George Soros and Steve Mandel avoided potentially huge losses on financial stocks. The last couple of weeks have been horrible for those holding bank stocks especially, with the share prices of large banks like Bank of America (BAC) and Citigroup (C) sliding rapidly. Tudor Investment Corp. and TPG-Axon Capital Management LP, Paulson & Co., Lone Pine Capital LLC and Soros Fund Management all cut financials especially banks according to recent disclosures.
Hedge funds run by John Paulson, George Soros and Steve Mandel cut back on bank shares in the second quarter, before Citigroup Inc. and Bank of America Corp. lost more than one-fifth of their value. 
Tudor Investment Corp. and TPG-Axon Capital Management LP were among those trimming banks, according to filings made to the Securities and Exchange Commission by yesterday's deadline. Fidelity Investments, the second-biggest U.S. mutual-fund company, sold 25 million shares of New York-based JPMorgan Chase & Co., or about 21 percent of its stake. 
Money managers had been wagering that shares of banks and other financial institutions would benefit from an economic recovery. As the year progressed, some managers got spooked by banks' exposure to mortgages the institutions made before the housing bubble burst, said Manal Mehta, a partner at Branch Hill Capital, a San Francisco-based hedge fund that has short positions on Charlotte, North Carolina-based Bank of America.

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