Icahn posts 10.3% loss on portfolio in quarter
Hedge fund billionaires say commodities to blame for rough year
Carl Icahn, who brief
NEW YORK ly toyed with an offer to be Donald Trump’s Treasury secretary, posted a 10.3% loss in his investment portfolio for the quarter ended in September amid declines in stocks such as Chesapeake Energy, where Icahn is the largest shareholder.
Icahn’s 10.3% quarterly decline has resulted in a loss of 2.8% for the year, executives from his firm, Icahn Enterprises, said Thursday.
It has been a rough year for professional investors thanks to wild swings in stocks, commodities, currencies and bonds.
Hedge fund manager Bill Ackman said his Pershing Square Holdings is down 18% for the year following a 7% decline in October.
Ackman’s portfolio was hit by a series of devastating blows to pharmaceutical company Valeant, in which he owns a roughly 6% stake. The pain continued Thursday with the drug company’s stock dropping another 14% on news of a Congressional investigation into allegations of price gouging.
Valeant stock is down to $78.77 a share from a high of $262.50 on Aug. 5, which is expected to drag down a number of hedge funds that followed Ackman into this investment. The average global hedge fund is still down 1.3% this year, according to data from Hedge Fund Research.
Icahn Enterprises CEO Keith Cozza attributed the quarterly loss to declines of stocks with exposure to commodities, suggesting losses in energy holdings. Third-quarter “performance was negatively impacted by losses from some of our long equity positions with significant exposure to the commodity sector,” Cozza told investors.
Shares of Chesapeake Energy, where Icahn holds an 11% stake, are down 61.8% this year, according to FactSet. Freeport Mcmoran, where Icahn holds an 8.8% stake, is down 48%, and Navistar International, where he holds a 20% stake, is down 60.7%, FactSet said.
Icahn is known for publicly pushing for companies to make changes that he thinks will boost their stock prices. Recently, he asked insurance giant AIG to consider breaking into three pieces, a proposal supported by hedge fund billionaire John Paulson.
Icahn is slated to meet with the CEO of insurance giant AIG to discuss his proposal that the company be broken up into three parts.