Despite Tesla Disaster, Tilson Returns 14% In 2014

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Whitney Tilson has finally released his 2014 letter to investors, in an email sent to investors. We have not had any update on performance since Q2 and with positions such as Tesla going from the 30s to $205 (the wrong way for Tilson) we thought that it would be a rough year – However, Tilson had an impressive return of 13.7%, which is far better than the average hedge fund. The manager of Kase Capital has now invested alongside Bill Ackman, not the first time, but this time literally. Tilson also attached the January edition of VII- we had obtained a copy and covered it a bit, but now that it is in public domain we can attach a full copy below.

Also see Tilson’s full track record below:

Check out Tilson’s email to investors below

Lumber Liquidators LL Tesla Whitney Tilson K12 Questcor Pharmaceuticals QCOR

Attached is my 2014 annual letter for the Kase Fund. Here is an excerpt:

In this, my 16th annual letter, I seek to frankly assess the fund’s performance and share my thoughts on various matters. In addition, I disclose the fund’s 12 largest long positions and, in Appendix A, discuss each of them. My goal in doing this is so you can better understand how I invest, my thinking behind each of these holdings, and why I am very confident in our fund’s future prospects.


Our fund was up 13.7% in 2014, as this table shows:

2014 Since Inception
Kase Fund – net 13.7% 179.1%
S&P 500 13.7% 125.5%

Past performance is not indicative of future results. Please refer to the disclosure section at the end of this letter. The Kase Fund was launched on 1/1/99.

I’m satisfied with the fund’s performance last year. While matching the return of the S&P 500 is hardly something to write home about, very few funds kept up with the market in 2014 (and even fewer long-short equity hedge funds; estimates show an average gain of ~3%), so our fund was likely in the top 10% of its peer group for the year.

More broadly, over the last four years our fund has shown a trend of improving performance on both a relative and absolute basis, and I’m confident that this will continue.

…The top 12 long positions (all those 4% or larger), ranked in descending order of size, are:

  1. Howard Hughes
  2. Platform Specialty Products
  3. Avis
  4. Pershing Sq. Holdings
  5. Air Products & Chemicals
  6. Reading International
  7. Samsung Electronics
  8. Micron Technology
  9. JetBlue Airways
  10. Delta Airlines
  11. Tetragon
  12. Berkshire Hathaway

(Past performance is not indicative of future results. Please refer to additional disclosures at the end of the attached investor letter.)

2) In May I will be attending my 17th consecutive Berkshire Hathaway annual meeting in Omaha. If you’re going to be there as well, I’d like to invite you to three events on Friday evening, Saturday afternoon, andSunday morning, all in the St. Nicholas Room at the Omaha Hilton:

1) My friend Chuck Gillman and I are hosting our annual cocktail party from 8pm-midnight on Friday, May 1st. No agenda, no speeches, no dress code – just come, enjoy the drinks and snacks, and meet other value investors.

2) Chuck and I are also hosting a casual get-together immediately following the annual meeting on Saturday, May 2nd – just walk across the street or take the skybridge to the Hilton. It will end around6pm.

3) On Sunday morning, May 3rd from 8-10am I will host my annual breakfast for investors and prospective investors in my funds. I will give a presentation and then take questions.

To RSVP for these events, please email Jill at [email protected] and include:

  • Which event(s) you plan to attend
  • Your name as you wish it to appear on your nametag
  • Firm (if any)
  • City you’re from

I look forward to seeing you!

3) Attached is the latest issue of Value Investor Insight, which every month features in-depth interviews with two top value investors, in which they share their investment philosophy and history, as well as 3-5 of their current favorite investment ideas. For only $349/year ($329/year if you subscribe for two years; half price for students), you’ll receive VII every month plus get exclusive first access to my articles and presentations in which I share my favorite investment ideas. If you’d like to subscribe, just go or call (866) 988-9060.

4) Howard Hughes (HHC) has been my largest position for a few years and I bought more recently after it pulled back due to concerns about the possible impact that the decline in oil prices might have on the company’s two properties in Houston. Blogger and analyst Todd Sullivan did a nice job addressing this in particular and, I general, showing how cheap the stock is in a presentation that he gave last week at the Boys and Girls Harbor conference, which I’ve posted at:

5) At the Robin Hood Investors Conference in October, I presented Micron Technology, the airlines and SodaStream as longs and Lumber Liquidators and Exact Sciences as my two largest short positions (then and now). Links are:,,, and

6) I gave a presentation at Columbia Business School recently entitled Lessons From a Dozen Years of Short Selling, which is posted at:

7) I’ve posted at an insightful, spot-on report on JetBlue (which I own in size) by my friend Kian Ghazi, who has started a special situations research service covering the fertile hunting ground of companies undergoing a CEO change. If you’re interested in learning more, contact Kian [email protected]

8) I’m visiting Taiwan for the first time in June, arriving early Tuesday morning, June 16th and departing on Friday evening, June 19th. I’m quite fascinated by the country, both personally and as an investor, and hope to find some great investment opportunities there. Please let me know if you have any suggestions for companies/people/things I should see/meet/do.

9) I enjoyed this article about why there are so few women money managers (and even fewer in the hedge fund world) and what can/should be done about it: ‘Girls Who Invest’ Would Change Wall Street(

I wrote two articles on this topic last February and March that were published on the NY Times’ web site:

  • Evaluating the Dearth of Female Hedge Fund Managers, 2/12/14:
  • A Deeper Conversation on Women in Hedge Funds, 3/7/14:

Kase Fund annual letter-2014

Value Investor Insight-1-15-Hood, South Shore (1)

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