TEL AVIV (Reuters) - From buying distressed emerging currencies and gold to “shorting” an ambitious cable TV operator, eight of the world’s leading hedge fund managers offered investment ideas to cope with market uncertainty on Wednesday.
Speaking at the Sohn Investment Conference in Tel Aviv, Paul McNamara, investment director at Swiss-based GAM Holding Inc, is putting his fund’s money into emerging market currencies that have tumbled.
“Our top trade is to buy ‘dogs’ in emerging markets,” he said. “They will come back.”
GAM has strong positions in the Brazilian real, Mexican peso, Indonesian rupiah and Colombian peso. McNamara does not like the outlook for the Peruvian sol, Malaysian ringitt and Turkish lira but the fund did not disclose its short positions.
Paul Singer, CEO of New York-based Elliott Management, with $26 billion under management, said institutional investors should keep 5-10 percent of their portfolios in gold to protect against persistent zero interest rates that are degrading paper money.
Singer, whose fund invests in gold through options, said he was downbeat on global economic recovery prospects and fears another recession since governments have not enacted pro-growth policies, leaving central banks to run the global economy.
ION Asset Management made a case for shorting shares in Patrick Drahi’s Altice, which owns Israeli cable operator HOT and is buying Cablevision Systems Corp for $17.7 billion.
“We think Altice shares are worth half of where they are trading today,” said ION Managing Director Stephen Levey.
He and partner Jonathan Half believe Altice is overpaying for its acquisitions, they are sceptical of its margin targets and believe its cost-cutting targets are unrealistic. They declined to comment on their trading position, if any, in Altice.
UK hedge fund Lansdowne Partners Chairman Stuart Roden said he favours German real estate, Disney, Nike and Lloyds Banking Group - companies in which Lansdowne has long positions.
Goldman Sachs Investment Partners co-head Raanan Agus touted another bank, Royal Bank of Scotland, which is shrinking to focus on the UK. He believes the shares could nearly double within three years.
Reporting by Tova Cohen and Steven Scheer; Editing by Elaine Hardcastle