BlueCrest Capital Management is among Europe’s biggest hedge funds, with $14 billion in assets under management as of January 1, 2015. The Guernsey-based investment firm was established by William Reeves and Michael Platt in 2000. BlueCrest Capital employs a multi-strategy investing approach across the fixed income and public equity markets in the United States and United Kingdom. The two founders had worked as Managing Directors and senior proprietary traders at JP Morgan prior to establishing their own firm. By closely analyzing the latest 13F filing submitted by BlueCrest, we identified three bullish moves made by the firm during the second quarter. The three stocks that have received investor confidence from BlueCrest Capital are represented by Simon Property Group Inc. (NYSE:SPG), Facebook Inc. (NASDAQ:FB), and Herbalife Ltd. (NYSE:HLF).
Why are we interested in the 13F filings of a select group of hedge funds? We use these filings to determine the top 15 small-cap stocks held by these elite funds based on 16 years of research that showed their top small-cap picks are much more profitable than both their large-cap stocks and the broader market as a whole; yet investors have been stuck (until now) investing in all of a hedge fund’s stocks: the good, the bad, and the ugly. Why pay fees to invest in both the best and worst ideas of a particular hedge fund when you can simply mimic the best ideas of the best fund managers on your own? These top small-cap stocks beat the S&P 500 Total Return Index by an average of nearly one percentage point per month in our backtests, which were conducted over the period of 1999 to 2012. Even better, since the beginning of forward testing at the end of August 2012, the strategy worked just as our research predicted and then some, outperforming the market every year and returning 118% over the last 35 months, which is more than 60 percentage points higher than the returns of the S&P 500 ETF (SPY) (see more details).
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BlueCrest Capital acquired a 95,000-share stake in Simon Property Group Inc. (NYSE:SPG) during the quarter, which is valued at $16.44 million as of the end of June. Simon Property Group Inc., the largest U.S. real estate investment trust (REIT), recently announced that its majority-owned operating partnership subsidiary, Simon Property Group, issued senior notes with a principal amount of $1.1 billion that have a weighted average coupon rate of 3.05%. The REIT is using a part of the proceeds to refinance its existing debt; the net proceeds will be used to fund the redemption of $366.6 million outstanding of the company’s 5.75% note due 2015. The ups-and-downs of the stock this year might have been frustrating for some of its investors, but the stock has still delivered a gain of over 5% year-to-date. In the meantime, Simon Property Group Inc. (NYSE:SPG) is the top REIT of Jeffrey Furber’s AEW Capital Management for the current period. The real estate investment manager owns 2.97 million shares of the REIT, which are valued at $513.89 million.
