New York (TheStreet) -- Although a loss tied to a giant position built by what Wall Street has dubbed a "London Whale" trader added little drama to
annual shareholder meeting, quarterly filings of stock positions signal that it's taken a bite out of prominent hedge funds.
After the bell on Tuesday,
Moore Capital Management
, two of the best returning and most sophisticated hedge funds in the world, disclosed that they built large share positions in JPMorgan during the first quarter which ended on March 31. The postions were made just before shares of the nation's largest bank were hit in April and May amid revelations of a giant and lossmaking trading position.
In filings that represent a snapshot of each fund's holdings at the end of the first quarter, or March 31, Moore Capital Management reported it bought roughly 6.5 million JPMorgan shares worth a total of $297.3 million. Meanwhile Tudor disclosed that it built a $58.5 million position in roughly 1.27 million JPMorgan shares. Both stakes are valued at $45.98, JPMorgan's closing price on Mar 31, or the end of the first quarter.
Were Tudor and Moore to have maintained those stakes roughly midway through the second quarter, they're likely to have generated big losses as JPMorgan's shares were hit by a $2 billion trading loss it disclosed earlier in May. From the end of the first quarter to Tuesday's close, JPMorgan shares are off over 21%, closing trading at $36.24. In the past five trading days, shares have plummeted over 12%, amid uncertainty tied to the loss.
For Tudor, its purchase of JPMorgan represented its biggest new single stock position in the quarter, but the investment dwarfed a $136.8 million new position in the
Financial Select Sector SPDR ETF
. Other big buys include,
. The hedge fund liquidated minor positions in
Similarly, Moore was focused on the financial sector, opening up a 6.8 million share position in
, a 5.15 million share holding of
and a 5.25 million share stake in
Bank of America
On Monday David Tepper's
has upped its big bank holdings with a big purchase of
stock without buying into JPMorgan shares. So far, Tudor and Moore signal that other funds won't be so lucky.
In a May 14 filing, Omega Advisors, run by Leon Cooperman, disclosed it bought 1.34 million JPMorgan shares in the quarter, more than doubling its holding to 2.22 mllion shares. Meanwhile, George Soros- founded
bought 606,300 JPMorgan shares in the quarter and
TPG-Axon Capital Management
upped its holding in the bank to 3.13 million shares.
Hedge fund and investment managers who oversee more than $100 million are required to disclose their equity holdings, options and convertible debt on a Form 13F filed to the
Securities and Exchange Commission
within 45 days of the end of a quarter. Funds aren't required to report short positions, which bet on declines.
Othe hedge funds like
AQR Capital Management
Odey Asset Management
also bought JPMorgan shares in the quarter.
Some funds pared holdings in the bank ahead of its trading loss, including
Maverick Capital Management
, which sold 3.7 million shares in the quarter, trimming stake to 4.7 million shares.
liquidated its JPMorgan position during the first quarter, selling all of its 2 milllion shares.
JPMorgan's stock has shed over 11% or $17 billion in market value since the bank disclosed a $2 billion
on May 4 tied to a synthetic credit portfolio at its Chief Investment Office, where the bank invests its excess capital for hedging benefits and trading gains.
That loss led to a share tumble, diminished second quarter earnings expectations and a
of JPMorgan's debt rating by
as other agencies downgraded their outlook. On Monday, the bank
of its CIO division and now faces a string of
after chief executive Jamie Dimon called the loss an "egregious" trading mistake that showed "flawed, poorly reviewed, poorly executed" and sloppy management.
On Tuesday, JPMorgan Chase was the winner among the largest U.S. financial names on Tuesday, with shares rising over 1% to close at $36.24. JPMorgan's shares had fallen over the previous two sessions; however, at the company's annual meeting in Tampa, Fla. a shareholder proposal to strip Dimon of JPMorgan's chairmanship garnered only 40% of the vote, while shareholders also approved the CEO's $23 million pay package for 2011.
Meanwhile shareholders were far more interested in hearing Dimon's perspective on JPMorgan's core earnings from activities ranging from mortgage lending and deposit taking than his further explanation of the firm's trading loss, which may grow by $1 billion and is expected to add volatility to earnings in coming quarters.
-- Written by Antoine Gara in New York