Caxton Associates, a renowned global macro hedge fund, recently disclosed its portfolio updates for the second quarter of 2023, which ended on June 30, 2023. The firm, founded by Bruce Kovner in 1983, is known for its diversified investment approach, focusing on a broad range of asset classes including equities, commodities, fixed income, and currencies. The firm's investment philosophy is rooted in rigorous research, risk management, and the pursuit of investment opportunities across global markets.
Portfolio Overview
The firm's portfolio contained 473 stocks with a total value of $676 million. The top holdings were Nvidia Corporation (NVDA, Financial) with 6.74%, Amazon.com Inc. (AMZN, Financial) with 6.39%, and Microsoft Corporation (MSFT, Financial) with 5.86%.
Key Transactions
The following were the firm's top three trades of the quarter:
Freeport-McMoRan Inc (NYSE:FCX)
Caxton Associates (Trades, Portfolio) completely sold out its 2,959,371-share investment in Freeport-McMoRan Inc. The previous weight of this stock in the portfolio was 18.26%. The shares were traded at an average price of $38.15 during the quarter. As of August 15, 2023, FCX had a price of $41.21 and a market cap of $59.08 billion. The stock has returned 32.41% over the past year. GuruFocus gives the company a financial strength rating of 6 out of 10 and a profitability rating of 7 out of 10. In terms of valuation, FCX has a price-earnings ratio of 28.42, a price-book ratio of 3.65, a PEG ratio of 2.07, a EV-to-Ebitda ratio of 7.96, and a price-sales ratio of 2.71.
Amazon.com Inc (NAS:AMZN)
The firm established a new position in Amazon.com Inc, purchasing 331,495 shares, which now constitute 6.39% of the equity portfolio. The shares were traded at an average price of $114.02 during the quarter. As of August 15, 2023, AMZN had a price of $140.57 and a market cap of $1,450.37 billion. The stock has returned -2.08% over the past year. GuruFocus gives the company a financial strength rating of 6 out of 10 and a profitability rating of 8 out of 10. In terms of valuation, AMZN has a price-earnings ratio of 110.69, a price-book ratio of 8.60, a PEG ratio of 4.77, a EV-to-Ebitda ratio of 23.97, and a price-sales ratio of 2.72.
Microsoft Corp (NAS:MSFT)
Caxton Associates (Trades, Portfolio) also established a new position in Microsoft Corp, purchasing 116,389 shares, which now constitute 5.86% of the equity portfolio. The shares were traded at an average price of $313.01 during the quarter. As of August 15, 2023, MSFT had a price of $324.04 and a market cap of $2,407.54 billion. The stock has returned 12.08% over the past year. GuruFocus gives the company a financial strength rating of 8 out of 10 and a profitability rating of 10 out of 10. In terms of valuation, MSFT has a price-earnings ratio of 33.44, a price-book ratio of 11.68, a PEG ratio of 1.81, a EV-to-Ebitda ratio of 22.41, and a price-sales ratio of 11.43.
In conclusion, Caxton Associates (Trades, Portfolio)' Q2 2023 portfolio update reveals a strategic shift in its investment focus. The firm's sell-out of Freeport-McMoRan Inc and new positions in Amazon.com Inc and Microsoft Corp reflect its confidence in the tech sector's potential for growth and profitability.
