Some of the world's most successful hedge fund managers gathered in Manhattan on Monday to share their investing strategies on everything from the U.S. housing market to when to do business with Vladimir Putin.
Many attendees at the 19th Annual Ira Sohn Investor Conference plopped down $4,000 a piece to hear tips from these titans of finance. Here are five top tips you can follow in case you weren't able to swing that ticket price.
1. Einhorn still hates tech stocks
Billionaire David Einhorn isn't backing off from his recent claim that soaring tech stocks are in bubble territory.
The founder of Greenlight Capital sought to illustrate his point by focusing on athenahealth (ATHN), whose shares have skyrocketed 120% since November 2012.
The provider of technology services for medical practices is "caught up in a bubble and could easily" plunge 80% or more from its recent peak, Einhorn said.
The hedge fund giant draw laughter by showing a series of video clips that poked fun at Jonathan Bush, the animated athenahealth CEO and a cousin of former president George W. Bush.
Einhorn said athenahealth's lofty valuation doesn't match up with its disappointing financial results, and he knocked Morgan Stanley for overly optimistic expectations for the stock's performance.
"This is what passes for conservatism during a bubble," Einhorn said, whose call sent athenahealth tumbling 12%.
2. There's money to be made in Russia
While many investors are slashing their exposure to Russia, James Grant believes there's good reason to kick the tires of Gazprom, Russia's state-owned energy behemoth.
In a decidedly contrarian call, the founder of Grant's Interest Rate Observer told the crowd: Gazprom "may or may not be a bad company," but low valuations suggest its "many imperfections seem to be priced in."
Geopolitical concerns have hammered Russian assets, with investors fearing punishing sanctions from the U.S. and an escalation of violence. But Grant quoted from Baron Rothschild, who famously said "the time to buy is when there's blood in the streets."
Grant knocked Gazprom's corporate governance structure, which gives Russia's government control of 50% of the London-listed company.
"There is no more reviled business than Gazprom," Grant said, calling it "Herbalife without Carl Icahn" and suggesting it's the "polar opposite investment" of Tesla Motors (TSLA).
Still, he noted Gazprom is the world's largest gas producer, it owns 17% of global gas reserves and trades at a hefty discount to average analyst price targets.
3. Oil prices are heading South
Surging U.S. oil production should send crude oil prices sharply lower in the coming quarters.
That was the message from Point State Capital's Zach Schreiber, who believes U.S. crude will continue to trade at a sharp discount to global prices.
"U.S. crude oil is being drilled for by the same cast of characters that oversupplied the U.S. natural gas market. We just saw this movie. Why should we expect a different outcome," said Schreiber.
He noted the bullish oil bet has become awfully crowded, with a $33 billion net long position in U.S. crude contracts.
"If you're long, I'm sorry for you. Maybe this makes you comfortable. At least you've got friends," Schreiber said. "Or it could make you feel scared. I'm sure it will be a very smooth exit when all these clowns get out of the Volkswagen."
4. Housing market bouncing back? Think again
Jeffrey Gundlach believes housing prices are set to tumble to new lows because affordability is a myth, borrowing costs will spook potential home buyers and young people may continue to rent instead of buying.
"This is a generational preference. Young people were shocked and scarred by the housing collapse," said Gundlach, founder of Doubleline Capital.
He pointed to the high percentage of people who moved back in with their parents amid the poor job market and high levels of student debt.
"The kids aren't alright," he said. "There are no first-time buyers. Where are they?"
Gundlach also cited the large amount of homes that have been purchased with cash by investors and other speculative buyers.
"This is not exactly indicative of organic growth in the market from real buyers," said Gundlach.
Gundlach urged investors to short the SPDR S&P Homebuilders exchange-traded fund (XHB), which he believes "looks very tired." He said this ETF should correlate very closely with lumber prices, which have tumbled.
5. Ackman's still likes Fannie and Freddie
Bill Ackman took a break from his campaign against Herbalife (HLF) to make the case for keeping Fannie Mae and Freddie Mac alive despite their enormous crisis-era losses.
Instead of unwinding Fannie and Freddie, Ackman believes it would be far wiser for Congress to reform them. He suggested jacking up required capital ratios, forcing the entities to exit risky businesses and improving corporate governance.
Fannie and Freddie have an "80-year track record, global market acceptance for their paper, a workforce that knows the business and earnings stream that generates capital even in bad times," he said.
Ackman said Fannie and Freddie are conservatively worth $23 and could be valued at as much as $47, compared with just $4 now (these two do trade, but only "over the counter," not on a national stock exchange).
"It's time to get off our fanny," said Ackman, whose hedge fund owns about 10% of Fannie and Freddie's common stock.
Here's a fun fact: The stock market, as measured by the S&P 500 (SPX), had its strongest performance this year since the Wolf of Wall Street roamed lower Manhattan.
The broad market gauge has gained 29.6% in 2013, its biggest jump since 1997 -- the year before Jordan Belfort, the hard-partying founder of brokerage firm Stratton Oakmont, was indicted for securities fraud and money laundering.
Belfort, who served nearly two years in MOREBen Rooney - Dec 31, 2013 7:22 AM ET
Who doesn't want to be a billionaire? A new app, aptly named iBillionaire, won't turn you into one. But it makes it easier for you to invest like one.
iBillionaire, which launched Wednesday, tracks what Warren Buffett, Carl Icahn, Bill Ackman and other financial titans are buying and selling.
Using SEC filings, the data are fed automatically into the app, though the iBillionaire team has a data analyst on staff MORECatherine Tymkiw - Apr 10, 2013 11:23 AM ET
JC Penney's latest tangle has many folks speculating about whether there's another hedge fund battle brewing.
The retailer said it received a Notice of Default from law firm Brown Rudnick, which claims to represent an "ad hoc" group who hold more than 50% of JC Penney's bonds due in 2037.
JC Penney says the notice is "utterly without merit" but it's raised speculation as to who is behind this so-called ad hoc MORECatherine Tymkiw - Feb 5, 2013 12:33 PM ET
Hedge fund titans Bill Ackman and Carl Icahn squared off over Herbalife (HLF) Friday afternoon. And it was like a scene from a kindergarten playground.
For 30 minutes, the two lobbed insults at each other on CNBC as Ackman's bet on Herbalife's stock falling to zero drew the ire (and a litany of insults) from Icahn.
After listening to the confrontation, the public now knows a few things about these two.
For one, MOREMaureen Farrell - Jan 25, 2013 3:30 PM ET
It's Herbalife's turn.
As hedge fund titans Bill Ackman and Dan Loeb square off over the company's sales practices, the company's top executives played defense.
"We are confident that you will see that we're a legitimate company with legitimate customers," Herbalife CEO Michael Johnson told investors and analysts gathered at the Four Seasons in midtown Manhattan Thursday. Johnson called the opportunity to address the crowd "unusual but incredible."
Ackman, who runs Pershing MOREMaureen Farrell - Jan 10, 2013 10:31 AM ET
Hedge fund manager Bill Ackman outlined why he and his team of analysts have dubbed the nutritional supplement company Herbalife (HLF) as a "pyramid scheme" at a conference in New York Thursday morning.
Herbalife's stock dropped nearly 4% Thursday, its second straight day of sharp drops. The vitamin maker's stock dropped more than 12% Wednesday, after CNBC reported that Ackman had been betting against the stock for most of 2012. MOREMaureen Farrell - Dec 20, 2012 12:52 PM ET
Not a member yet?Sign up now for a free account
|How to invest in real estate without buying a home|
|Sears sells Craftsman to Stanley Black & Decker|
|ABC cancels 'Roseanne' after star's racist Twitter rant|
|How can I protect my investments from inflation?|
|Fake news, real violence: 'Pizzagate' and the consequences of an Internet echo chamber|