New regulatory filings show that several big hedge-fund players loaded up on JPMorgan even as heavy losses on a soured credit derivative bet made by a trader known as the "London whale" sent the bank's stock reeling.
It seems as though managers such as Jim Chanos, John Paulson and Jamie Dinan saw the stock's 22 percent drop in the second quarter as a buying opportunity.
For much of the quarter, the JP Morgan story riveted the financial world after the bank, long acclaimed for navigating crises better than its peers, got tripped up by a bad bet that could cost it at least $6 billion.
Andrew Feldstein's BlueMountain Capital, which won big by taking the other side of the JPMorgan credit bet, nearly tripled its holdings of the bank's stock to 233,505 shares, according to a filing Tuesday with the Securities and Exchange Commission.
Similarly, James Chanos, whose Kynikos Associates is traditionally a short player that bets stocks will fall, raised his holdings in the bank to 323,400 shares from 91,6000 shares.
Hedge fund manager Jamie Dinan, who runs York Capital and whose name sounds eerily like that of JPMorgan boss Jamie Dimon, took a stake of 2.8 million shares in addition to having an option to buy another 1 million shares.
And John Paulson, whose major bet on Bank of America contributed to his firm's embarrassingly large losses last year, placed more chips on the banking sector with a new 4 million- share stake in JPMorgan.
Dinakar Singh's TPG-Axon Capital Management raised its stake to 3.3 million shares from 3.1 million; John Griffin's Blue Ridge Capital kept its holdings in the bank at 6.1 million; and Ricky Sandler's Eminence Capital held firm at 1.9 million shares.
While the sharp drop in price made JPMorgan stock look historically cheap, not everyone was convinced that it was time to buy.
Lee Ainslie's Maverick Capital, which has made a strong comeback this year after a disappointing 2011, appears to have liquidated his 4.6 million holding, filings show.
George Soros, the philanthropist investor whose investment decisions have been eyed for decades, appears to have done the same thing by no longer listing JPMorgan shares on his filing.
Andreas Halvorsen, trained by Julian Robertson, another hedge fund industry legend, appears to have gotten rid of 1.6 million shares.
And Louis Bacon's Moore Capital Management cut his stake to 4.3 million from 6.4 million.
(With additional reporting by Aaron Pressman in Boston and Katya Wachtel in New York. Editing by Matthew Goldstein and Ciro Scotti)
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