February 13, 2016 / 12:21 AM / 3 years ago

David Tepper's Appaloosa hedge fund makes bet on energy sector

BOSTON (Reuters) - Billionaire investor David Tepper’s Appaloosa Management bet on the embattled energy sector during the fourth quarter, buying stocks including Kinder Morgan, Southwestern Energy Co., Freeport-McMoRan, and Williams Partners.

According to the fund’s latest 13-F filing made on Friday, Tepper bought 9.4 million shares of energy company Kinder Morgan, whose shares are roughly flat this year even as commodity prices have fallen. The fund bought 4.3 million shares of natural gas and oil exploration company Southwestern Energy Co. who’s shares have climbed 25 percent this year.

He also bought 2.3 million shares of Williams Partners LP, which has tumbled 50 percent, and added 3.5 million shares of natural resource company Freeport-McMoRan, whose stock has dropped 18 percent this year.

Commodity prices have tumbled this year and weighed on many energy company share prices. Fund managers have also voiced concern about anemic economic growth, which would not help energy demand.

U.S. crude oil futures jumped 12 percent on Friday, yet oil was still headed for a weekly loss.

The 13-F filings show what U.S. stocks a fund owned at the end of the previous quarter and while the filings are often backward looking, investors pay close attention to them nonetheless to try and divine investment trends.

Tepper, 58, has been called one of the best traders of his generation and his $18.6 billion hedge fund has routinely delivered returns so strong that the manager has periodically returned capital to investors because the fund was getting too large.

The manager, a former Goldman Sachs junk bond trader who is worth an estimated $11.6 billion according to Forbes magazine, runs his fund from Short Hills, New Jersey and recently opened an office in Miami.

Reporting by Svea Herbst-Bayliss; Editing by David Gregorio

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