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Daniel Loeb's Best Picks for 2011

Dan Loeb's Offshore Fund returned an additional 3.9% in January beating both the SPY and fellow hedgies David Einhorn and Whitney Tilson. Dan Loeb's other big winners in January were Potash (POT), Smurfit Stone Container (SCCC), Massey Energy (MEE) and Aveta. His biggest losers were GLD, Brenntag AG, Mead Johnson Nutrition (MJN), African Barrick Gold, and Accuride (ACW).

Potash returned 17.7% in January. This is one of hedge funds' favorite investments. Mohnish Pabrai also has Potash in his portfolio.

In January, Smurfit-Stone Container Store announced that it will be acquired by Rock Tenn (RKT) for $35 a share. The stock gained 46% in January. David Tepper and Barry Rosenstein were other SSCC investors.

In January Alpha Natural Resources (ANR) also agreed to buy Massey Energy for a 21% premium. MEE returned 17% in January, contributing to Loeb's outstanding performance. Some of Alpha Natural Resources insiders were selling weeks before the announcement.

Gold is the largest position in Loeb's portfolio. GLD lost 6.4% in January. There are several hedge funds that invested in gold and suffered from the decline in gold. The decline in African Barrick Gold, which trades in London, reached almost 18% in January. Mead Johnson Nutrition's decline reached 7% in January, underperforming the SPY's 2.4% increase. Finally Accuride lost nearly 6% in January.

This article was originally published on Insider Monkey .

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.
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