Redmile Group returns an estimated 9.3% in May
Redmile Group Llc returns an estimated 9.29% for May 2015 - the fully hedged version returns 4.6%
Redmile Group Llc generated a 9.29% return on their publicly disclosed long portfolio for the month ending May 2015, outperforming the S&P500 by 928 basis points (bps). On a hedged basis, the portfolio would have returned 4.6% StockAlpha over the same period. Redmile's StockAlpha reflects the net return if each security in their portfolio was hedged with a sector ETF, such that the resulting portfolio was market, beta and sector neutral. StockAlpha in the Health sector contributed the most to StockAlpha during the month.
Positive Contributors to Redmile's Returns
Redmile’s position in Array Biopharma Inc (ARRY) contributed the most to the performance of the manager’s long-portfolio during the month. Over the month of May 2015, Redmile's 8.7% position in Array Biopharma Inc (ARRY) increased in value by 19%, contributing 1.66% (8.7%*19%=1.66%)to the long portfolios overall return. Looking at Redmile's portfolio through a fully hedged StockAlpha lens, the holding of Array Biopharma Inc (ARRY) also provided the largest contribution to fully hedged returns. Array Biopharma Inc (ARRY) returned 19% during the month compared to the Health sector, which returned 4.5%. As a result, after taking into account Array Biopharma Inc (ARRY)'s beta relative to its sector, the position contributed 1.1% of StockAlpha to the Redmile’s monthly performance.
Negative Contributors to Redmile's Returns
Much of the drag on Redmile’s long-portfolio during the month can be attributed to the holding of Fluidigm Corp (FLDM). Over the month of May 2015, the manager's 2.1% position in Fluidigm Corp (FLDM) returned -32.8%, contributing -0.7% (2.1%*-32.8%=-0.7%)to the long portfolios overall return. Looking at Redmile's portfolio through a fully hedged StockAlpha lens, the holding of Fluidigm Corp (FLDM) also provided the most negative contribution to fully hedged returns. Fluidigm Corp (FLDM) returned -32.8% during the month compared to the Health sector, which returned 4.5%. As a result, the position contributed -0.8% of StockAlpha to the manager’s monthly performance.
Overlap with other hedge funds
Of Redmile’s top 10 largest positions, Seattle Genetics Inc (SGEN) is the name that is owned by most other hedge funds. 3.8% of hedge funds within Symmetric's universe had a position in Seattle Genetics Inc (SGEN) as of March 31, 2015, making it a contrarian name relative to other stocks, even though it is the most consensus within the manager's top positions. Redmile initiated its position in Seattle Genetics Inc (SGEN) 0.5 years ago. Other hedge funds that have significant ownership stakes in Seattle Genetics Inc (SGEN) include Tt International (58.9% position initiated 0.3 years ago), Mondrian Investment Partners Lt (11.1% position initiated 3.8 years ago) and Pointstate Capital (9.6% position initiated 1.3 years ago). Overall, Redmile's book is contrarian, with the average position held in the portfolio held by 6.3% of hedge funds. Screen, monitor and bechmark hedge fund managers at Symmetric.io