Arnie,
Maybe this article from Barrons Online has something to do with it.
Hedge Fund Managers' Picks, Pans For 1997
Dow Jones News Service ~ January 6, 1997 ~ 1:53 pm EST
By Julie Creswell
NEW YORK (Dow Jones)--Some hedge fund managers are hunkering down for a
rough ride in the stock market this year.
''I think we're going to see more of a bear market in 1997, with a lot of unpleasant
market gyrations,'' predicts Morton Cohen, chief executive and president of Clarion
Partners L.P., a private investment group with $15 million in assets based in
Cleveland.
A slowing economy, rising interest rates and some price inflation will be just some of
the factors that will lead to increased volatility in the stock market this year, the
hedge fund manager says. ''Even so, those able to identify good, solid companies
can still make money in the stock market in 1997,'' Cohen adds.
Hedge funds are unregulated private investment partnerships that can use their
money, plus borrowed money, to speculate in just about any stock, bond,
commodity or currency they choose.
A sector that sizzled in 1996 - energy - continues to be a favorite among hedge fund
investors this year.
Among Cohen's holdings is American Exploration (AX), a Houston-based natural
gas exploration and production company; Norway-based Smedvig asa Class B
shares (SMVB), an offshore well company; and Cairn Energy USA Inc. (CEUS),
an oil and gas exploration and production company based in Dallas.
Cliff Henry, a general partner at Worthington Growth L.P., a $100 million hedge
fund based in New York that focuses on mid-cap securities, likes KCS Energy
(KCS) and United Meridian Corp. (UMC), two oil and gas exploration and
production companies.
(MORE) DOW JONES NEWS 01-06-97
1:51 PM
Hedge Fund Managers -2-: Looking for 25%, 35% Growth
Henry invests in firms he believes will have a 25% to 30% growth rate, and he
expects overall market growth of 9% to 10% in 1997. Along with his energy stock
stakes, he likes the prospects of several biotech firms. He owns Matritech
(NMPS), which provides cancer testing, and Agouron Pharmaceutical (AGPH),
which develops synthetic drugs to treat cancer and other diseases.
Cohen is betting on SEQUUS Pharmaceuticals Inc. (SEQU), which will ''benefit
from increasing use of Doxil (for AIDS-related Kaposi's sarcoma) following
additional clinical data and recent FDA approval for Amphotec,'' used to treat
fungal infections, he says.
On the technology front, Cohen is focusing on companies involved in storage and
wireless technology, including Louisville, Colo.-based Storage Technology Corp.
(STK) and Quantum Corp. (QNTM) in Milpitas, Calif.
Henry forecasts a rebound for semiconductor manufacturers in 1997. He's invested
in Cognex (CGNX), which manufactures machine vision systems, and Robotic
Vision Systems (ROBV), which makes scanning systems for the semiconductor
industry.
Henry also likes ''Year 2000'' technology companies Viasoft Inc. (VIAS), Zitel
Corp. (ZITL) and Data Dimensions (DDIM).
Cohen's fund, Clarion Partners, may also sell short securities. His ''pans'' for this
year include Liposome Co. Inc. (LIPO) of Princeton, N.J., which develops lipid
and liposome-based drugs, and MedCath Inc. (MCTH), which operates five
cardiac diagnostic centers. Cohen says the Charlotte, N.C.-based company suffers
from cost overruns and rapid management turnover.
Cohen also recommends investors avoid consumer electronics retailer Tandy Corp.
(TAN). In late December, the Fort Worth, Texas-based firm announced plans to
sell all 17 of its Incredible Universe electronic outlets.
(END) DOW JONES NEWS 01-06-97
1:53 PM |
