Hedge Funds

Up nearly 40%, SAC alum's fund is one of year's best

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An under-the-radar hedge fund run by Gabriel Plotkin, a former star money manager at SAC Capital, is shaping up to be one of the year's best performers.

Melvin Capital, a $1.5 billion fund that focuses primarily on consumer stocks, is up nearly 40 percent through the end of October, according to people familiar with the matter.

The return dwarfs both that of the average hedge fund, which was flat through the same period, and the broader U.S. stock market, which was up close to 1 percent.

It also more than triples the year-to-date performance of Point72, the family office, or privately managed, fund company into which SAC morphed a year and a half ago after being indicted on insider-trading charges it eventually settled.

Where hedge funds are putting their money
Where hedge funds are putting their money

Point72, which runs a far wider portfolio with a range of long and short bets on various market sectors, is up 12 percent through October, according to people familiar with its results.

Melvin, which began trading late in 2014, appears to have done particularly well this year with a large stake in Amazon that has a market value of roughly $100 million, according to regulatory filings compiled by the data provider Symmetric; Amazon is up nearly 122 percent so far for 2015 and is Melvin's largest holding.

Other large positions that have performed especially well, according to Symmetric's database, include Constellation Brands and Alphabet, both up about 46 percent, and Expedia, up about 47 percent.

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Reached for comment on Monday, David Kurd, a Melvin official, declined to comment on his fund company's performance, citing regulatory guidelines that prevented him from disclosing them to non-investors.

Plotkin, who according to the New York Times once ran a consumer-stocks portfolio for SAC valued at $1.3 billion, received a commitment from Steve Cohen, SAC's founder, to invest some $200 million in Melvin last year.

However, Melvin's fundraising in 2014 was so quick and successful that some other SAC alumni -- now working for Point 72 -- were not ultimately able to invest alongside their boss, causing disappointment, according to someone with knowledge of the attempts.

Melvin isn't the only fund generating notable returns this year. In addition to Point 72, the Chicago-based Citadel's flagship multistrategy funds are up about 12 percent, according to officials there.

And the Passport Special Opportunities fund, a San Francisco based vehicle that invests in everything from foreign stocks to the U.S. dollar, is up about 22 percent, according to a hedge-fund report and someone familiar with the matter.