(Reuters) - Prominent hedge fund managers appeared to make big second-quarter bets that the U.S. economy would continue to expand despite increasing concerns about a broadening trade dispute between the United States and China, regulatory filings showed Tuesday.
Third Point added new positions in payment companies PayPal Holdings Inc (PYPL.O) and Visa Inc (V.N), both of which are up more than 19 percent year to date. Greenlight Capital, run by billionaire investor David Einhorn, added new positions in low-to-middle income retailers including Dollar Tree Inc (DLTR.O), Dollar General Corp (DG.N), Gap Inc (GPS.N), and TJX Companies Inc (TJX.N), the parent company of discount retailers TJ Maxx and HomeGoods.
Activist fund Jana Partners added shares of broad-based exchange-traded funds that track the S&P 500 and the Russell 2000 indexes and took new positions in Wells Fargo & Co (WFC.N) and food delivery company GrubHub Inc (GRUB.N).
The flurry of new positions in cyclical companies came during a quarter in which U.S. gross domestic product increased at an annual rate of 4.1 percent, nearly double the 2.2 percent rate of the first quarter of the year, according to Commerce Department estimates.
A rally in cyclical companies would help boost hedge fund industry returns at a time when many fund firms are under pressure from investors to lower their fees or improve their performance. Hedge funds, on average, are up 1.5 percent since the start of January, according to research firm Hedge Fund Research, well behind the 6.2 percent gain in the benchmark S&P 500 index over the same time.
“Everyone is comparing everything to the S&P 500 and that’s a very difficult hurdle for the last few years,” said Sol Waksman,
