By Svea Herbst-Bayliss
BOSTON (Reuters) - Daniel Loeb's Third Point (NYSE:TPRE) LLC funds posted strong gains in November to extend year-to-date returns into the double digits after the billionaire investor overhauled his portfolio and the firm a few months ago.
The Third Point Offshore Fund gained 9.1% in November and is now up 12.3% for the year, while the Third Point Ultra fund gained 12.1% last month and is now up 14.2%, according to a performance update seen by an investor.
The gains were fueled mainly by investments in credit as well as fundamental equity bets, particularly in the media and internet and enterprise technology sectors.
Loeb added stocks including Amazon (NASDAQ:AMZN), Disney and Alibaba (NYSE:BABA) during the year. During the third quarter he trimmed the stakes in Amazon and Disney slightly, regulatory filings show.
The gains represent a dramatic swing coming only months after Third Point was caught off-guard by the coronavirus and massive market sell-off to end the first quarter with double-digit losses. The Offshore fund lost 16% while the Ultra fund was down 21% at the end of the first quarter.
Third Point, which now oversees $14.8 billion in assets, has always had a flexible investment mandate and while the firm has been known for some of its recent large activist bets, Loeb shifted course some this year.
In May, he took back the reins from Munib Islam who had been promoted to co-chief investment officer last year and had largely been the face of Third Point's activism positions, including a bet this year on Prudential (NYSE:PUK) Plc.
Activism, which Third Point also calls constructivism, weighed on returns this year, the source said.
Third Point is handily outperforming the average hedge fund, which gained only 1.2% in the first ten months of 2020, according to Hedge Fund Research data. More recent data is not yet available.