Carl C. Icahn is one of several billionaire investors who have bet big on a Donald Trump presidency.
So bullish was Mr. Icahn that he said he made $1-billion worth of bets in the stock market the morning after Mr. Trump won the election.
In a regulatory filing on Tuesday with the Securities and Exchange Commission, Mr. Icahn, 80, revealed some of the other bets he made in the last three months of 2016. He loaded up on shares of his company, Icahn Enterprises, which invests in a variety of industries. Icahn also increased his position in Herbalife, the beleaguered vitamin supplements company in which he already owned more than 20 percent of the outstanding shares.
Mr. Icahn’s stock trading since the election has interested some Democratic senators, who recently raised concerns about potential conflicts of interest given his role as a special adviser to Trump on overhauling regulation.
In a letter to the White House on Monday, seven Democratic senators sought assurances from the White House that Mr. Icahn would not recommend regulatory changes that could personally benefit some of his investments in a variety of industries.
It is not just Mr. Icahn who is betting big on Trump. More broadly, Wall Street has turned bullish in the wake of Trump’s victory, pinning its hopes on a new administration — with a Republican-controlled Congress — delivering big tax cuts and rolling back regulation.
The U.S. stock market has risen to a record high even as the White House has come under scrutiny for a ban on immigration from seven mostly Muslim countries — blocked while the matter is argued in court — and the resignation on Monday of Michael T. Flynn as national security adviser over concerns about conversations he had with Russian officials before Trump was sworn into office.
In the months since the election, the Standard & Poor’s 500 stock index has soared about 9 per cent. Banks and other financial stocks have risen about 20 per cent, while industrial stocks, including manufacturing and construction firms, have risen about 11 per cent. Consumer company shares have gained roughly 9 per cent.
Mr. Icahn was one of hundreds of hedge fund and other investment fund managers to make their quarterly declarations to the SEC about which stocks they bought in recent months. Known as 13-Fs, these reports offer investors a glimpse at where these professional traders placed their bets during a given quarter, though they are filed roughly 45 days after the quarter ends.
But the filings offer an imperfect window into the holdings of money managers because they are a snapshot of the past. They include only stocks traded in the United States but do not include short positions, or bets a manager might have made that a stock will fall in price. They also do not include bets on the future direction of the market, a favorite trade of Mr. Icahn and his firm.
This time, however, the regulatory filings reveal the big rush of money into the market over a quarter that coincided with Mr. Trump’s election victory.
Many of the hedge fund managers jumping on the so-called “Trump Bump” trade loaded up on financial stocks in the final quarter of the year, riding shares of banks like Goldman Sachs Group, which are up more than 37 per cent since the election, and Bank of America, which has had a more than 40-per-cent gain over the same period. Some of the big-name managers whose firms added stakes in financial stocks in the final months of 2016 included Daniel S. Loeb, Julian Robertson, David Tepper and O. Andreas Halvorsen.
Nelson Peltz’s firm, Trian Fund Management, took a big 4.86-per-cent stake in Procter & Gamble, one of the largest manufacturers of family, personal and household care products. Mr. Peltz has a reputation as an activist investor who takes stake in companies and then pushes for corporate changes to increase shareholder value. His firm also added shares of Bank of New York Mellon.
Shares of Fannie Mae and Freddie Mac, the giant mortgage finance firms that the federal government placed in conservatorship during the financial crisis, also have surged since Mr. Trump’s election. Shares of Fannie, for instance, are up more than 160 per cent. The rally has been prompted in part by comments from Steven T. Mnuchin, Mr. Trump’s Treasury secretary and a former hedge fund manager.
Mr. Mnuchin said he favored the recapitalization of the two firms and would plan to cut the government’s hold over them. Mr. Mnuchin, confirmed by the Senate on Monday, made those comments a day after Mr. Trump nominated him.
His early comments on Fannie and Freddie were welcome news to a group of hedge fund managers, like Paulson & Co. and William A. Ackman’s Pershing Square Capital Management, that bet on mortgage finance firms. Mr. Ackman’s firm acquired big stakes in shares of both Fannie and Freddie in late 2013 and the stocks are two of his firm’s big winners in 2016 — a year in which one of Pershing Square’s portfolios lost a little more than 13 percent.
Paulson & Co, a firm led by John Paulson in which Mr. Trump and Mr. Mnuchin have been investors at various times, reported trimming its bet on gold through an exchange traded fund. The firm also bought a new stake in the drug company GlaxoSmithKline.
But Mr. Icahn’s bet will be of most interest with politicians in Washington, where senators have sought assurances from the White House that safeguards would be put in place to ensure Mr. Icahn does not have access to information that is not public and could be used to make a profitable trade.
Icahn Enterprises, Mr. Icahn’s firm, has several large investments in companies that are directly affected by regulations, which he has described as stifling. In the fourth quarter, he acquired another 2.9 million shares of his company.
It is his majority investment in CVR Refining, an oil refiner that is a core investment of Icahn Enterprises, which is of biggest concern to lawmakers. CVR is required by the Environmental Protection Agency to blend its oil or buy credits, something that Icahn has called “completely totally absurd.”
Mr. Icahn, who did not return phone calls seeking comment, has blamed the EPA for the bankruptcy of several oil refineries in the United States.
Still, in Tuesday’s filing, he did not report any change in the number of shares his firm has in CVR.Report Typo/Error