In two new filings with the U.S. Securities and Exchange Commission today, Kingdon Capital, led by Mark Kingdon, disclosed that it upped its passive stakes in both XOMA Corp (NASDAQ:XOMA) and Heron Therapeutics Inc (NASDAQ:HRTX). Kingdon Capital reported holding 10.82 million shares of XOMA Corp (NASDAQ:XOMA), up from 7.57 million shares the fund held as of the end of the first quarter. The stake is equal to 9.19% of the company’s common stock. The fund was bullish on XOMA Corp (NASDAQ:XOMA) during the first quarter, boosting its ownership in the company by 24%, and that is clearly continuing into the second quarter. Meanwhile, Kingdon Capital also boosted its stake in Heron Therapeutics Inc (NASDAQ:HRTX), to 2.83 million shares from the 615,851 shares it held as of March 31. The stake is equivalent to 9.56% of the company’s common stock.
At Insider Monkey, we track hedge funds to learn about their investment strategies. According to our research, hedge funds’ large-cap stock picks historically delivered a monthly alpha of six basis points, though these stocks underperformed the S&P 500 Total Return Index by an average of seven basis points per month between 1999 and 2012. These stocks were able to generate alpha because of their lower risk profile. On the other hand, the 15 most popular small-cap stocks among hedge funds outperformed the S&P 500 Index by an average of 95 basis points per month. These stocks were slightly riskier, so their monthly alpha was 80 basis points (read the details here). Since the official launch of our small-cap strategy in August 2012 it has performed just as predicted, returning over 144% and beating the market by more than 84 percentage points.
Kingdon Capital was founded by Mr. Mark Kingdon in 1983. The fund employs fundamental and technical analysis, and a top-down approach to select economies and industries for investment. From its inception through 2011, Kingdon Capital Management had an annualized return of 16.6%. In its latest 13F, the fund disclosed a public equity portfolio valued at $2.36 billion. The fund’s top holdings, in terms of value, are represented by Horizon Pharma PLC (NASDAQ:HZNP), Tyson Foods Inc. (NYSE:TSN), and Visteon Corp (NYSE:VC).
Follow Mark E. Kingdon's Kingdon Capital
XOMA Corp (NASDAQ:XOMA) is a late-stage biotechnology company engaged in the discovery and development of therapeutic antibodies. The company has a market cap of $425.31 million. For the first three months of 2015, XOMA Corp (NASDAQ:XOMA) booked a net loss of $21.7 million, versus a loss of $24.7 million in the same period last year. Total revenues for the quarter were $2.7 million, down from $3.4 million in the same quarter of 2014. In a partnership with French pharmaceutical research company Servier, XOMA Corp (NASDAQ:XOMA) is developing gevokizumab, the company’s lead drug to treat patients with a wide variety of inflammatory and other diseases. On May 28, XOMA Corp (NASDAQ:XOMA) announced that the gevokizumab phase 3 EYEGUARD-B study reached its target exacerbation event. The primary endpoint result is expected in approximately seven weeks, according to the company. Other shareholders with heavy positions in XOMA Corp (NASDAQ:XOMA) include Baker Bros. Advisors, led by Julian Baker and Felix Baker, holding 14.71 million shares as of the end of March, and D E Shaw, founded by David E. Shaw, which held 1.95 million shares as of March 31.
