ETF News

Hedge fund Renaissance slashes BoA stake, ups Citi

BOSTON, Nov 13 (Reuters) - Renaissance Technologies, one of the world's biggest and most profitable hedge funds, sharply reduced its stake in Bank of America BAC.N and added to its holdings of Citigroup C.N in the third quarter.

Between July and the end of September, Renaissance sold off 3.62 million shares of Bank of America, the largest U.S. bank, according to a regulatory filing released on Friday.

At the end of the quarter, the hedge fund owned 404,485 shares in the Charlotte, North Carolina-based bank, down from 4.02 million shares it owned at the end of the second quarter.

Renaissance, which relies solely on computer models to make trading decisions, invests roughly $17 billion and its Medallion Fund has been among the industry’s most consistent earners, delivering an average annual return of more than 30 percent since it was launched in 1988.

Bank of America’s embattled chief executive officer, Kenneth Lewis, told his board on Sept. 30 that he plans to step down by the end of the year.

Also during the quarter, Renaissance significantly raised its stake in Citigroup to 21.5 million shares from 17,700 at the end of the second quarter. During the second quarter, Renaissance sold roughly 21.5 million shares of Citigroup.

Both banks had struggled with losses on soured mortgages.

Since July, however, Citigroup’s share price has climbed 38 percent while Bank of America’s share price rose 22 percent.

The hedge fund also trimmed its holdings of HSBC Holdings Plc to 811,195 shares at the end of the third quarter, down from 1.1 million shares at the end of the second quarter. (Reporting by Svea Herbst-Bayliss, editing by Matthew Lewis)