John Burbank’s flagship hedge fund Passport Capital is having a much better 2012, than the 2011 drop of 18%.  We obtained Passport Global’s Q1 letter, in which Burbank noted that he would be scaling back on risk, and became bearish on the economy, which was reflected in the portfolio.
John Burbank III
The $4 billion hedge fund was up 4.1% as of March 26th, 2012.
According to our sources with direct knowledge of the matter, Passport Global has returned 3.4% in the second quarter of the year. The one year return for Passport Global is -8.3%.
The fund is still bearish.  Passport Global started the quarter long 66% and short 78%, at the end of the quarter the fund is 88% long and 95% short, for a net short exposure of 7%. It appears that Burbank is still bearish, albiet less bearish than in the beginning of the year.
The top four positions of the fund are as follows:
VIVUS, Inc. (NASDAQ:VVUS)
  CYT (the only top position which is the same as in Q1)
Liberty Interactive Corp (NASDAQ:LINTA)
Macy’s, Inc. (NYSE:M)
An interesting top position is Research In Motion Limited (TSE:RIM) (NYSE:RIMM). Research In Motion Limited (TSE:RIM) (NYSE:RIMM) is one of the fund’s top positions. Burbank did not explain the rationale for the investment in RIM. The largest shareholder of Research In Motion Limited (TSE:RIM) (NYSE:RIMM), is Prem Watsa’s Fairfax Financial Holdings Limited (TSE:FFH) , the company recently took a 9.9% stake in the troubled blackberry maker. Prem Watsa serves on the board of the Canadian based company. The stock has declined over 95% since its peak in 2008. The stock appears cheap on a quantitive basis, but some investors think the Canadian based company is doomed, and the stock is a value trap.
Burbank is short Miners, US Steel producers, and natural gas. Considering his predictions of a recession in 2013, this is not surprising. These industries are highly cyclical, and were among the worst performers in the previous bear market. Burbank mentioned in his letter earlier this year, that he sees China’s growth slowing. With China being the largest importer of many raw materials, this has made many investors bearish on the company.
Burbank is short Natural gas, via the ETF United States Natural Gas Fund, LP (NYSE:UNG). UNG invests in natural gas futures and seeks to replicate its performance.
 Burbank is extremely bullish on the Middle east and North Africa (MENA) equities. Burbank mentioned earlier this year that Saudi stocks are extremely attractive, and states ‘Saudi Equities constitute the best asymetric equity market,’ adding that the largest allocation of the fund is in the Saudi Stock market.