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- Coatue Management scored a 52% gain this year by betting on Tesla and against German fintech Wirecard, the Financial Times reported.
- The $11 billion tech-focused hedge fund is run by “Tiger cub” Philippe Laffont, who previously worked at billionaire Julian Robertson’s Tiger Management.
- Coatue held 3.1 million Tesla shares at the end of the third quarter that are now worth $1.3 billion, the FT said.
- The fund’s performance eclipses the average 17% return gained by tech-focused hedge funds this year.
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New York-based Coatue Management has been one of the best-performing big hedge funds in 2020, scoring a gain of 52% through November.
Coatue made its notable gain by betting on Elon Musk’s fast-rising automaker Tesla and against scandal-plagued German payments processor Wirecard, according to the Financial Times.
The tech-focused fund makes long-short investment strategies, meaning that it buys equities that are expected to increase in value and sells those expected to decrease in value. The tech focus helped create a success story for Coatue as tech stocks went through a blockbuster rally during the work-from-home environment this year.
Run by prominent “Tiger cub” Philippe Laffont, who spent time working at Julian Robertson’s Tiger Management, the main fund manages assets worth more than $11 billion.
The fund’s position in Tesla helped notch big gains since the carmaker’s stock is up 592% year-to-date, boosted by retail investor interest and its upcoming inclusion in the S&P 500 on December 21. Coatue held 3.1 million Tesla shares at the end of the third quarter, now worth $1.3 billion, the FT said, citing a source.
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The fund also held a big short position in Germany’s biggest accounting fraud, Wirecard. The fintech filed for insolvency after a huge accounting scandal that saw $2 billion go missing and its former CEO’s subsequent arrest. Coatue’s exact position in Wirecard is not clear.
Coatue’s solid performance overshadows the 5% gain in HFR’s Global Hedge Fund Index so far this year.
The hedge fund did not immediately respond to Business Insider’s request for comment.
“I truly believe that in every portfolio you need to ask yourself what is going to be more relevant five to 10 years versus today,” FT quoted Coatue’s Laffont as saying at a 2018 industry conference. “The most interesting trend is that technology, which used to be mostly software and semiconductors and obscure things, it’s coming everywhere, it’s the future of cars and the future of transportation and every sector.”
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