Tiger Global Management still likes Amazon, Netflix and JD.com, which fueled last year’s positive returns, even as their stock tumbled in January, leaving the hedge fund with a double digit loss at the start of the year.
“The consumer Internet remains the largest long theme in (Tiger Global Investments), followed by software, financial technology, and retail and consumer,” the firm wrote to clients in a letter seen by Reuters. Last year, the letter said Tiger‘s “positions in consumer Internet, namely Amazon, JD, and Netflix helped drive overall returns.”
This year, Netflix and Amazon have lost roughly 25 percent and the declines hit Tiger Global‘s roughly $6 billion hedge fund hard. In January, the fund lost 14 percent after gaining 6.8 percent in 2015. Many hedge funds started the year with losses.
Shaking off that poor start, Tiger said its managers recently met with renowned former New York Yankees shortstop Derek Jeter for tips from the five-time World Series champion about how to persistently perform well.
The 15-year-old firm, which oversees a total of $20 billion, has long ranked among the industry’s most closely watched for its successful bets on technology names. Last year, Scott Shleifer replaced Feroz Dewan, who left the firm, in running its public equity business.
After a strong end to 2015, 2016 started on a rocky note, the firm acknowledged, explaining that “our longs declined considerably but our shorts have not gone down nearly as much.”
Tiger did not name its short positions, as is common among hedge funds, but described them generically as “companies we believe will become less relevant over time, with concentrations in retail, technology, and a myriad of other industries and companies we believe we know well.”
It also assured investors that the Tiger team is used to volatile trading conditions and “intends to act decisively when our investment process yields asymmetric opportunities.”
Performance at Tiger can be up and down. Last year it lost 5.5 percent in the first quarter only to come roaring back with an 11.5 gain in the last three months of the year.
The firm promised to keep “searching for ways to improve” in 2016 and said it was inspired by Jeter, who trained hard, stayed humble and played every game and season “like he was competing for his job.”