AAPL, VOD, Gold Soar in Q3 Boosting Greenlight’s Returns

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Greenlight Capital Re, Ltd. (NASDAQ:GLRE) had a profitable September and third quarter, according to new data posted on the company’s website. The re-insurer run by David Einhorn was up 0.5 percent in the month of September compared to the S&P 500 (.INX) return of 3.0 percent for the month.

AAPL, VOD, Gold Soar in Q3 Boosting Greenlight's Returns


For the quarter, the re-insurer returned 4.0 percent slightly trailing the S&P 500, which was up 4.7 percent in Q3. Greenlight Capital is now up 12.2 percent in 2013 compared to 18 percent for the broad stock market. Although Einhorn is trailing the market, the performance is far better than most hedge funds this year. Many hedge funds are trailing the index by well over 1000 basis points.

According to Greenlight Capital RE’s website:

As of 30-September-2013, the largest disclosed long positions in our investment portfolio are Apple Inc. (NASDAQ:AAPL), General Motors Company (NYSE:GM), gold, Marvell Technology Group Ltd. (NASDAQ:MRVL), Oil States International, Inc. (NYSE:OIS) and Vodafone Group Plc (NASDAQ:VOD) (LON:VOD); The investment portfolio is approximately 106% long and 71% short. This exposure analysis is calculated on a delta adjusted basis and excludes macro positions, which consist of gold, credit default swaps, sovereign debt, foreign currency positions, interest rate derivatives and others.

The fund positioning is nearly identical to what Greenlight reported at the end of August.

Apple Inc. (NASDAQ:AAPL) was up approximately 20 percent in the third quarter providing a big boost for the fund. General Motors Company (NYSE:GM) was another solid performer, up 8 percent in the past three months. After several bad quarters, gold had a strong month up approximately 8 percent. Vodafone Group Plc (NASDAQ:VOD) (LON:VOD) was up 22 percent, while OIS returned 12 percent. The only detractor from the disclosed longs positions- MRVL down 2 percent in the past three months.

While Einhorn’s top holdings would seemingly indicate a much stronger fund performance, large short positions likely hampered returns. One long time Einhorn short (assuming the position was not closed), Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR), was flat for the quarter, so that position likely did not detract from the strong long gains. We will have to wait for the Q3 letter to solve that mystery.

Greenlight Capital Re, Ltd. (NASDAQ:GLRE) shares soared by 16 percent over the past three months.

Below is a chart of recent returns for Greenlight Capital Re, also make sure to check out David Einhorn’s Q2 letter to shareholders.

Net Monthly Returns:

September 2013 0.5%

Net Quarterly Returns:

 2013 2012 2011 2010 2009
1st……….  5.8%    6.5%  (3.4)%    (1.9)% 4.6%
2nd………  2.0 (3.3) (1.9) 2.6 13.9
3rd……….   4.0 8.8 0.1 3.6 4.3
4th……….  —— (4.4) 7.6 6.5 6.4
Full Year  12.2 (2)
7.1 2.1 11.0  32.1


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