BOSTON ( TheStreet) -- David Einhorn's Greenlight Capital initiated stakes in multimedia conglomerate CBS ( CBS), carmaker General Motors ( GM) and semiconductor company Marvell Technology ( MRVL) in the third quarter as the hedge fund bucked the stock market's sharp decline.Despite the benchmark S&P 500 Index's 14% drop in the quarter, which was marked by violent market swings, "our conservatively managed portfolio essentially went sideways with much lower volatility," decreasing 1.2%, Einhorn said in a letter to hedge fund shareholders this week. Greenlight will report third-quarter holdings next week, which will give a fuller picture of his investments. Besides equity investments, Einhorn, 42, struggled to work out a deal to buy his beloved New York Mets baseball team, an effort that ultimately failed. The Greenlight hedge fund fell 6.2% from the start of the year through the end of the third quarter, versus the 7.7% decline of the S&P 500. Returns by famous hedge fund managers are all over the place this year as many countries' economies accelerated, then slowed unexpectedly. Billionaire investor John Paulson is down more than 30% this year, while James Simons' Renaissance Institutional Equities Fund is up more than 30%. According to eVestment/HFN, its HFN Hedge Fund Aggregate Index, which includes the results from just over 4,000 hedge funds, fell 3.1% in September and was down 5.6% for the year through the end of the third quarter.
Greenlight said Marvell, which designs semiconductors used in cell phones and computer hard drives, is a new addition based on its relative cheapness and its protected market niche. Its shares are trading at six times its estimated 2012 earnings, net of almost $4 per share in cash. And Greenlight expects the company will buy back 12% of its shares this year and still have about 30% of its market value in cash. "In short, this is a well-run company in structurally defensible markets that is being valued as if it is neither," said Greenlight.