Hedge Funds Gain Big on MCP

Molycorp, Inc. (MCP) opened at $33.36 on Thursday, October 6 after closing at $32.26 the day before. By the end of Thursday’s trading day, MCP stock had swelled to $36.45 a share. According to the Motley Fool, the shares jumped after “Pentagon released a report to Congress highlighting the military’s critical dependence on rare earth metals, most of which come from China. The military as well as industry’s reliance on rare earth elements and metals have driven the price of these products sky high along with Molycorp’s stock price in the last year.” The information in the report may be old news but Molycorp’s announcement of a huge rare earths deposit near its existing Mountain Pass operation is a brilliant example of strategic timing. Here are the hedge funds that gained the most:

John Thaler – JAT Capital Management: Gained $6.5 million

Richard Chilton – Chilton Investment Company: Gained $5.2 million

John Murphy – Alydar Capital: Gained $4.7 million

Mark Kingdon – Kingdon Capital Management: Gained $3 million

D.E. Shaw – D.E. Shaw: Gained $2 million

Philippe Laffont – Coatue Management: Gained $1.6 million

These calculations assume that these hedge funds did not increase or reduce their stock positions in MCP since the end of June. We did not take into account their option positions.