Guess who was buying?
Fidelity boosted Enron stake in third quarter
Reuters Company News - November 14, 2001 18:52
By Martha Slud
NEW YORK, Nov 14 (Reuters) - Fidelity Investments, the No. 1 U.S. mutual fund firm, boosted its stake in Enron Corp. in the third quarter -- just weeks before the energy trader's stock collapsed as investor confidence crumbled amid a U.S. regulatory probe, a filing showed on Wednesday.
Fidelity, one of the largest institutional shareholders of Enron, held 20.8 million Enron shares on Sept. 30, up from 16.5 million on June 30, according to the filing with the U.S. Securities and Exchange Commission.
The filing, which discloses the fund firm's third-quarter stock holdings, does not reveal how many Enron shares the Boston-based fund firm currently owns.
A Fidelity spokesman declined comment.
Shares of Enron, once a Wall Street darling, plunged in mid-October amid investor discomfort over the company's off-the-balance sheet deals that are now under investigation.
Enron stock is down about 63 percent so far in the fourth quarter, falling to $9.99 at Wednesday's close from $27.23 at the end of September. The company last week agreed to a buyout by smaller rival Dynegy Inc. for about $9 billion in stock.
A big chunk of Fidelity's Enron stake was held in the giant Magellan fund , the largest actively managed mutual fund with $71.6 billion in assets at the end of September.
Magellan, run by fund manager Robert Stansky, owned 5.71 million Enron shares as of Sept. 30, but that represented only 0.2 percent of the entire Magellan portfolio, according to a separate filing on Wednesday.
"Even the manager of the mighty Magellan can get a stock pick wrong," said Jim Lowell, editor of Fidelity Investor, a newsletter about Fidelity funds. "But in the bigger picture, he (Stansky) is still beating the S&P year to date. His fractional, but mistaken, investment in Enron hasn't hurt the fund."
Fidelity Magellan is down 12.6 percent year to date, compared with a 13.7 percent decline in the Standard & Poor's 500 index .
Rival mutual fund firm Janus Capital Corp. has owned an even bigger stake in Enron this year. The Denver-based fund firm held 42.8 million Enron shares at the end of June, the most recent portfolio information available.
Fidelity's stock holdings were worth $407.7 billion at the end of the third quarter, from $500.5 billion at the end of the second quarter, according to the fund company's filing. |
