Hedge funds stay defensive, up bets on healthcare

Jill Fromer | E+ | Getty Images

The 10 largest U.S. hedge funds moved out of China amid recession fears and snapped up more healthcare and pharmaceutical stocks than any other industry in the second quarter, spending $7.2 billion on the sector, new data finds.

Baxter International, the maker of hospital supplies was the most sought-after stock, boosting the overall popularity of the sector after Dan Loeb's Third Point invested $1.9 billion in the firm, making up some 18 percent of his portfolio, according to data compiled by S&P Capital IQ. Activist investor Loeb has also set his sights on two board seats and a say in the hunt for a new chief executive at Baxter International.

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