Hedge fund Point72 Asset Management recently unveiled its trading report for the June quarter. Its value stood at $33.63 billion at quarter’s close, showing 4.15% growth during the second quarter of 2023, up from $32.29 billion in March.
Steven Cohen, renowned for his keen investment insights and iconic presence on Wall Street, has built a financial colossus that commands respect from even the most seasoned players in finance. His balanced blend of caution and audacity has steered Point72 through the tumultuous tides of the market, establishing the Stamford, Connecticut-based fund as a symbol of financial triumph.
However, for Cohen, it’s more than just about impressive numbers; it’s the pursuit of a philosophy that goes beyond conventional wisdom. He’s shaped Point72 into a hub for innovative thinking, fostering an environment of insatiable curiosity and a team that dares to challenge the norm.
Innovating, Adapting
Cohen once remarked, “My belief is if you’re not innovating and not adapting, then you’re dying.”
During the recent quarter, the number of holdings managed by the fund saw a dip of 3.7%, going from 2,187 at the quarter’s start to 2,105 disclosed positions, encompassing shares, bonds, exchange-traded funds, and more.
The fund’s reported market value is currently at all-time highs despite choppy and volatile equity markets.
The top five positions in the fund by portfolio weight are: Put options on the SPDR S&P 500 ETF(US:SPY), at a 3.35% weighting; NVIDIA Corp (US:NVDA), at 2.07%; Microsoft Corporation (US:MSFT), 1.85%; Amazon.com (US:AMZN), 1.18%; and, Adobe (US:ADBE), 1.10%.
What Steve Cohen’s Team Bought
Cohen’s Point 72 revealed its notable positions for the most recent quarter, with buys in sectors ranging from tech to healthcare and logistics, highlighting the fund’s management team’s dynamic investment strategy.
Microsoft stood out as a significant play with the fund capitalizing on the tech giant’s consistent growth. The position in MSFT stock reached a market value of $620.79 million by quarter’s end. This translated to a 1.85% portfolio weight, an impressive jump of 1.45% during the quarter as Cohen rotated out of other FAANG players.
NVIDIA, another leader in the tech sector, saw its position in Point 72’s holdings grow to a value of $695.03 million. NVDA stock occupied 2.07% of the portfolio, marking an allocation growth of 1.22%. The position was aided by a 50% rise in the share price after NVDA made its single-largest earnings expansion in its history during the quarter, helping the chip maker reach the $1 trillion market cap level.
An intriguing put position was initiated in UnitedHealth Group (US:UNH), worth $211.34 million at the quarter’s close. This strategic move represents 0.63% of the portfolio, with a significant bet on a stock that has traded broadly sideways since the beginning of 2022.
Point 72 took a fresh interest in Micron Technology (US:MU), allocating a new position that grew to $178.29 million or 0.53% of the portfolio, suggesting bullish sentiment in the memory chip industry.
A newly initiated position in Union Pacific (US:UNP) was also evident as the holdings swelled to $172.76 million, accounting for 0.52% of the fund’s allocation.
In the creative software realm, the fund’s position in Adobe was expanded to $370.11 million. ADBE stock claimed 1.10% of the portfolio, with an allocation growth of 0.50%. The stock has continued its rally post close of the quarter.
Other new notable positions in the fund during the quarter with; Cigna Group (US:CI) with a $167.27 million position, biotech sector stock Immunogen (US:IMGN) seeing a new investment worth $164.4 million, energy sector stock Southern Company (US:SO) with a $158.81 million position and logistics heavyweight Fedex (US:FDX) worth $158.38 million by quarter’s end.
What Steve Cohen’s Team Sold
Atop the list of Point 72 sale transactions is Broadcom (US:AVGO). At quarter’s end, the AVGO stock position stood at a value of $56.36 million, reflecting 0.17% of the fund’s total allocation, down from 1.24% from the previous quarter.
A striking reduction was seen in Alphabet (US:GOOGL), with its value plummeting to a mere $0.91 million. Representing less than 0.01% of the portfolio, this position could well likely disappear.
The fund’s put position in SPDR S&P 500 ETF Trust (US:SPY) stood at a colossal $1,13 billion. Even with its sizable value, the position saw an allocation decline of 0.93%, ending at 3.35% of the portfolio, hinting at a bearish outlook on the broader market.
Despite its rebranding and dynamic market moves, Meta Platforms (US:META) faced a reduction in the fund’s allocation, closing at $240.32 million or 0.71% of the portfolio, marking a decline of 0.91% during the quarter.
Intel (US:INTC), a key player in the semiconductor space, saw its position at Point 72 reduced to $59.86 million, reflecting 0.18% of the total portfolio and a decline of 0.89%.
Arista Networks (US:ANET) witnessed a contraction in its allocation, ending the quarter with a value of $88.91 million or 0.26% of the portfolio, marking a decrease of 0.85%.
Salesforce (US:CRM), despite being a cloud computing heavyweight, saw its portfolio presence dwindle to a mere $0.67 million, accounting for only 0.002% of the portfolio by the quarter’s end.
Retail titan Walmart (US:WMT) saw its position value stand at $179.15 million by the quarter’s end, translating to 0.53% of the portfolio. The allocation shrank by 0.75%, suggesting a cautious approach towards the retail sector.
The ADRs of Alibaba Group (US:BABA), grappling with regulatory pressures, saw its position in the fund reduce to $80.13 million or 0.24% of the portfolio, marking a decline of 0.60% in fund allocation.
In the healthcare tech segment, Dexcom (US:DXCM), a pioneer in continuous glucose monitoring, ended the quarter with a miniscule position of $2.69 million, translating to 0.008% of the portfolio, falling from an 0.5% weight at the beginning of the quarter.
How Steve Cohen’s ‘Other’ Team is Doing
We would be remiss if we didn’t mention the Point 72 chief’s other team, the New York Mets. Perhaps New York Post columnist Mike Vaccaro summed it up best in his Aug. 16 piece:
“One more time, we are reminded that meaningless games are never entirely meaningless to everyone, even in a Mets season that has felt lost since Memorial Day or so, and unrelentingly meaningless since Aug. 1,” read the article’s lede paragraph.
That’s with a team on which Cohen splurged $806 million in last winter’s free-agent player transactions.
This article originally appeared on Fintel
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