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Soros, Paulson: Hedge Fund Dollar Store

Stocks in this article: BZH BSX CNXT BFR EPIC EXTR CFW

NEW YORK ( TheStreet) -- Hedge fund titans George Soros, of Soros Fund Management, and John Paulson, of Paulson & Co., are known for their deep pockets, but their portfolios include more than a few stocks they could have bought for what they probably consider spare change.

Quarterly filings made by both funds revealed on Monday just what stocks they'd bought and sold in the first quarter. The lists included plenty of household-name brands like Apple (AAPL) and JPMorgan Chase (JPM).

But small-cap stocks were also prominent in their quarterly trading decisions, particularly in the case of Soros.

It shouldn't come as a surprise that both hedge funds are buying shares of companies with stock prices at or less than $10, along with blue chips and the complex derivatives that don't make these quarterly filings.

After all, Paulson bought a stake in Family Dollar Stores (FDO) in the first quarter, acquiring 6 million shares of this literal dollar store. It was a good bet, too, even though shares in the cut-rate retail chain don't trade at a price befitting their brand name. The stock started the first quarter at $27 and have risen more than 30% since.

Soros and his team love dollar-store stocks even more than Paulson. Soros, too, owns a stake in Family Dollar, as well as more than 1 million shares in Dollar General (DG) stock and a smaller stake in Dollar Tree (DLTR).

Though Soros lightened up on all three holdings in the first period of 2010, he bought a bevy of a different kind of dollar-store stock.

Paulson's biggest small-cap bet in the first quarter was Beazer Homes (BZH), which early in the period was just under $4 a share and had risen to $5.50 by the close on Tuesday, thanks to the revelation of the Paulson investment and an upgrade to buy from Goldman Sachs (GS).

The Paulson bet on Beazer Homes received a lot of attention on Tuesday, since Paulson famously made a big short call on the housing sector before it crashed.

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