By Sam Forgione
NEW YORK May 7 David Einhorn's Greenlight
Capital has added to its investment position in Apple Inc
and is waiting for the company's "next blockbuster
product," Einhorn said on Tuesday.
In a conference call for his Cayman Islands-based reinsurer
Greenlight Capital Re Ltd, Einhorn did not specify when
the hedge fund added to its Apple position or the size of its
At the end of 2012, the $8.8 billion Greenlight Capital held
1.3 million Apple shares, according to a regulatory filing. At
the market close on Monday, the shares were worth about $600
Einhorn, one of the $2 trillion hedge fund industry's most
closely watched investors, had been pushing Apple to return some
of its massive cash pile to investors.
He said Apple's roughly 17 percent stock price decline in
the first quarter led to the biggest loss in the Greenlight
investment portfolio in the period.
He added, however, that Apple took a "major step forward" by
issuing $17 billion in bonds on April 30, and that its recent
plan to return $100 billion to shareholders via an increase in
its dividend and share buybacks is a "vastly more
shareholder-friendly" policy than it had a few months ago.
"We've added to our Apple position. Now we just wait for the
release of Apple's next blockbuster product," Einhorn said.
The hedge fund manager, who has a bullish stance on gold,
said he was "somewhat surprised" by the decline in gold prices
in April. Over a two-week stretch last month, the price of gold
fell 17 percent. It plunged $125 on April 15, its biggest-ever
But Einhorn said the recent regime change at the Bank of
Japan supports his outlook for a weaker yen and stronger
gold. He was referring to the appointment of new governor
Haruhiko Kuroda, who committed the central bank to a $1.4
trillion burst of monetary stimulus to fight deflation, mainly
through purchases of long-term Japanese government bonds.
"We believe that recent events, including the regime change
at the Bank of Japan, support our long-term thesis of both a
weaker yen and stronger gold," Einhorn said.
He said about a quarter of his investment portfolio's 5.8
percent return in the first quarter came from bets on a
weakening yen. He also said the gains from that wager have "more
than offset" the quarterly decline in gold prices.
Einhorn also said gains in Marvell Technology Group Ltd
and Vodafone boosted the investment return. He
said investors have focused on Marvell's strong product pipeline
and buyback plan, while Verizon's aim to buy Vodafone's
45 percent stake in Verizon Wireless has lifted Vodafone shares.
Einhorn is chairman of Greenlight Re. Hedge funds are
turning to reinsurers to become a permanent source of capital
that is not subject to investor withdrawals. The reinsurers use
their premiums to take positions in the hedge funds that set