There has been a lot of speculation as to why billionaire investor George Soros has cut down on his investments in the U.S. stocks by over a third and banking on gold. According to a report on government filing by Bloomberg, the publicly disclosed holdings of Soros Fund Management have dropped to $3.5 billion which is more than 37%.
Soros Fund Management on http://www.investopedia.com/university/greatest/georgesoros.asp has reported that it currently owns bearish options contracts all on 2.1 million shares of SPDR 500 ETF Trust. At the end of March, the fund bought a stake worth $264 million, in Barrick Gold Corp, the world’s biggest producer of Gold metal. The purchase of 1.7% of Barrick hence being the fund’s largest listed holding in the U.S.
George Soros like Stan Druckenmiller, his former chief strategist, can be said to be bullish. Stan has been reported saying that the metal is his largest currency allocation at such a time when even the bankers cannot trust the trend of the interest rates. Gold prices have a history of being robust and predictable.
According to a Bloomberg generic pricing, the biggest surge of 16% in Gold prices since 1986 happened in the first quarter of this year. Read more about this on http://www.cnbc.com/2016/05/17/soros-fund-management-outlines-new-allocations.html. Shares of Barrick which is based in Toronto have doubled this year. The miner has been employing significant cost cutting efforts and reducing g debt. Since March 31, Barrick has been up 39 percent.
Five years ago George Soros started returning money to his firms outside investors and left the New-York based firm only to manage his wealth. Though Michael Vachon his spokesman has declined to comment on the company’s holdings, there are reports that Soros has sold stakes in his big investments. This includes an interest in Communications Inc, which as of Dec 31 was worth $173 million, a stake in Dow Chemical Co. with a value of $161 million. The stakes in Delta Air Lines Inc and Endo International Plc have also been divested.
But Soros Fund Management is not the only investor cutting down their investments of U.S listed stocks. In the last quarter, Citadel Advisors, Glenview Capital Management, a hedge fund run by Larry Robbins and Millennium Management have also done the same. Citadels value of equity holdings fell by 29 percent, Glenview’s by 22 percent, and Millenniums’ b 17 percent.
George Soros, a hedge fund manager, turned philanthropist is a renowned investor since he made $24 billion by savvy market wagers. He is vocal on different issues especially those affecting the European Union like the immigration crisis and the Chinese debt. Soros warned of risks that could stem from Chinese debt-fueled economy. He compares it to the U.S economy in 2007-2008 at the start of the biggest global financial crisis.