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 percent since the election,
and Bank of America, which has had a more than 40 percent gain over the same period.
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.
Banks and other financial stocks have risen about 20 percent, while industrial stocks,
including manufacturing and construction firms, have risen about 11 percent.
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.
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.
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.
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.
Nelson Peltz’s firm, Trian Fund Management, took a big 4.86 percent stake in Procter & Gamble,
one of the largest manufacturers of family, personal and household care products.