UPDATE: Soros Fund Cuts Some Big Banks, Trims Gold ETF, Apple Stakes

--Soros reports no stake in Morgan Stanley, J.P. Morgan

--Firm lowers Citigroup, Apple, SPDR Gold Trust positions

--Overall value of holdings rises by 2.4% in first quarter

(Adds information on Apple, AIG and GE holdings throughout.)

 
   By Brett Philbin 
 

Soros Fund Management LLC disposed of stakes in banking giants J.P. Morgan Chase & Co. (JPM) and Morgan Stanley (MS) in the first quarter, while lowering its position in Citigroup Inc. (C) and Apple Inc. (AAPL), according to a regulatory filing late Wednesday.

Mr. Soros also lowered his exposure to the largest gold-backed exchange-traded fund, though he increased his bet on some gold miners during the period.

The firm, founded by billionaire investor George Soros, previously owned 2.6 million shares of J.P. Morgan, the nation's largest bank, at Dec. 31.

For Morgan Stanley, the fund eliminated a 4.1 million-share position, joining Third Point LLC's Daniel Loeb in shedding the securities firm from its portfolio.

Mr. Soros's apparent retreat from bank stocks also included reducing the firm's position in Citi by 7.6 million shares and dumping its 1.3 million-share call option on the lender. The stake, which is now 544,500 shares, was valued at $24 million.

Within technology stocks, Soros pared back his stake in Apple Inc. (AAPL), decreasing the position to 26,800 shares, from 183,976 shares in the fourth quarter. Mr. Soros though, added a call option to buy 100,000 shares of Apple stock.

Overall in the first quarter, the value of Mr. Soros's holdings rose 2.4% to $8.6 billion, from $8.4 billion in the fourth quarter, according to the filing with the Securities and Exchange Commission. The size of his portfolio increased by 15% to 209 positions.

In another reduction in the financial services industry, the firm lowered its stake in insurer American International Group Inc. (AIG), cutting the holding to 2.9 million shares, from 8.9 million shares in the prior period.

Mr. Soros, who once dubbed gold "the ultimate asset bubble," also lowered his stake in the SPDR Gold Trust (GLD) by 69,100 shares to 530,900 at March 31. The stake was valued at $82 million.

However, Mr. Soros increased his bets on gold miners during the period. For example, his firm bought 1.1 million shares of the Market Vectors Gold Miners ETF (GDX). The holding, which is now 2.7 million shares, was worth about $101 million.

One position that wasn't disclosed in the filing was Mr. Soros's stake in J.C. Penney Co. (JCP). The document only lists holdings as of March 31, but in late April, Soros Fund Management disclosed that it bought 17.4 million shares of the struggling retailer. With that purchase, Mr. Soros joined Pershing Square Capital Management founder William Ackman in betting on a turnaround at the beleaguered company.

In other moves, Soros eliminated his stake in conglomerate General Electric Co. (GE), shedding the 4.9 million-share position he had during the first quarter.

Soros's fund, which returned cash to outside investors last year, invests money for Mr. Soros and his family.

Investors who manage more than $100 million are required to disclose most securities holdings within a month and a half of the end of a quarter. The filings give the public a relatively fresh look at the portfolios of well-known investors. The first-quarter deadline was Wednesday.

Write to Brett Philbin at [e-mail]

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