Basso Capital Management, L.P. Q3 2022 vs. Q4 2022: A Look Into Their Investment Strategy

Basso Capital Management, L.P. is a multi-strategy hedge fund that focuses primarily on equity markets. The firm was founded in 1985 by Howard Lutnick and is headquartered in New York. For the third quarter of 2022, the firm reported holdings in excess of $1.5 billion, with significant investments in the technology, energy, and financial sectors.

However, a comparison between Basso Capital Management, L.P.’s Q3 2022 and Q4 2022 13F holdings reveals some significant changes in their investment strategy and portfolio. Let’s explore the details and understand why Basso Capital has made these changes.

The biggest change in the firm's Q4 2022 holdings is their stake in the SPDR S&P 500 ETF TR. Basso Capital held only 1,600 shares of the ETF in Q3 2022, but their holdings soared to 63,250 shares in Q4 2022. The value of their holdings in the ETF rose from $571,000 to $24.1 million, which is a staggering 4,136.2% increase. This move suggests that Basso Capital is bullish on the US equity market and its potential for growth.

Basso Capital also made significant investments in the Vanguard Index Funds. The firm did not hold any shares in the Vanguard Index Funds in Q3 2022, but their Q4 2022 holdings reveal large stakes in Vanguard Total Stock Market ETF (VTI) and Vanguard S&P 500 ETF (VOO). The value of their holdings in VTI stood at $7.5 million, while their holdings in VOO were valued at $2.6 million. This suggests that Basso Capital is confident about the growth potential of the US stock market.

In contrast to the technology and financial sectors, Basso Capital reduced its stakes in the gold market. The firm did not hold any shares in the SPDR Gold Trust in Q3 2022, but their Q4 2022 holdings reveal a stake of 14,620 shares, valued at $2.4 million. This is a positive move given the volatility in the gold market.

Basso Capital also made substantial investments in the energy sector. The firm did not hold any shares in the Energy Transfer LP in Q3 2022 but had stake 168,700 shares in Q4 2022, worth $2 million. Basso Capital also invested heavily in MPLX LP and Enterprise Products Partners LP, with their Q4 2022 holdings valued at $2.2 million and $1.7 million, respectively. This move suggests that Basso Capital is optimistic about the energy sector's potential for growth.

In the technology sector, Basso Capital invested heavily in Alphabet Inc. (GOOGL) and Apple Inc. (AAPL). In Q4 2022, the firm held 25,770 shares in GOOGL, valued at $2.3 million, and 15,880 shares in AAPL, valued at $2 million.

In conclusion, Basso Capital's Q3 2022 vs Q4 2022 13F holdings show that the firm is bullish on the US equity markets, with significant investments in the technology, energy, and financial sectors. The firm has made substantial investments in index funds, which suggests that they are confident about the US stock market's growth potential. This report shows the importance of 13F filings and how investors can use them to gain valuable insights into successful hedge funds.