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How Mets owner Steve Cohen ‘plays defense’ during market slump

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Mets proprietor Steve Cohen has adopted a defensive stock-picking strategy that’s plowing into secure havens together with oil and on line casino properties as he appears to be like to hedge towards the slumping market, in accordance with a report.

The 65-year-old hedge-fund magnate, who has an estimated web price of $11.9 billion, has not too long ago been specializing in so-called high-yield shares, that are equities whose dividend yield is larger than the yield of any benchmark common, such because the US Treasury’s 10-year notice.

Such shares are likely to outperform low-yield and no-yield securities throughout bear markets as a result of buyers contemplate them to be much less dangerous.

On the face of it, it appears to be like like a departure for Cohen, who as the pinnacle of the Point72 Asset Administration has earned a status for making huge, dangerous bets on risky shares.

In the course of the first quarter of this 12 months, Cohen’s fund purchased up 633,800 shares of VICI Properties, a New York-based actual property funding belief, or REIT, that makes a speciality of casinos, inns, and racetracks, in accordance with securities filings.

Cohen is the owner of the Point72 Asset Management hedge fund.
Cohen is the proprietor of the Point72 Asset Administration hedge fund.
Sipa USA by way of AP

VICI was created in 2017 as a part of a spin-off from Caesars Leisure after that firm went into an $18 billion chapter. VICI owns 10 resorts on the Las Vegas Strip encompassing 1.2 million sq. toes of on line casino house, greater than 40,000 resort rooms, and 6 million sq. toes of conference house.

In complete, VICI’s portfolio consists of 43 casinos; 450 eating places, bars, and golf equipment; and 4 main golf programs. In April, VICI introduced that it accomplished a $17.2 billion acquisition of MGM Progress Properties.

Shares of VICI Properties rose by almost 2% as of three p.m. on Thursday. At nearly $30 a share, Cohen’s stake in VICI quantities to some $18 million, according to the finance site TipRanks.

Cohen has upped his investments in high-yield dividend stocks.
Cohen has upped his investments in high-yield dividend shares.
AFP by way of Getty Photos

Cohen can also be betting on BP, the world’s largest oil and gasoline producer whose market capitalization has been valued at $104 billion.

The Mets boss purchased an extra 3,276,969 shares of BP. Cohen had already purchased half 1,000,000 shares of the corporate earlier than his newest funding — bringing the worth of his stake within the firm to some $122 million.

Shares of BP rose round 1% on Wednesday. BP inventory was buying and selling at round $32.40 per share as of three p.m. on Wednesday.

Like most power firms, BP posted spectacular income regardless of divesting from a 20% stake within the Russian agency Rosneft within the wake of President Vladimir Putin’s invasion of Ukraine.

Within the first quarter of this 12 months, BP reported a web revenue of greater than $6 billion — simply beating analyst estimates of $4.1 billion.