iBillionaire Index Rebalance Approaches

The iBillionaire Index has seen better days. But with its next rebalance on the horizon, perhaps it is poised for a turnaround.

The iBillionaire Index has seen better days. Since its latest rebalance on the 20th of February, the billionaire-tracking vehicle has declined -3.89%. But with its next rebalance on the horizon, perhaps it is poised for a turnaround.

Launched in November, 2013, the iBillionaire Index (IBLN) tracks the top 30 U.S. equities held by a select pool of billionaire investors. It is a large-cap, U.S.-only index based on the investment choices of the most consistently successful billionaires in the United States.

Since inception, the iBillionaire Index has returned 16.69%, compared to the 18.21% return of the S&P 500. In 2015, it has declined -0.90% vs. the 0.95% gain posted by the S&P. And since its last rebalance, it has dipped -3.89%.

There have, however, been some bright spots.

HCA Holdings (NYSE:HCA) returned +6.75% from February 20th, the date of the last iBillionaire Index rebalance, through market close Wednesday, May 6th. A hospital and health care holding company, HCA is held by billionaires David Tepper, Larry Robbins, Steve Mandel, John Paulson and Leon Cooperman.

The company reported financial results on May 5th. It said first-quarter earnings rose 70% and unveiled a $1 billion stock buyback plan. It also increased its long-term capital-spending estimate.

Priceline Group (NASDAQ:PCLN) has performed well as well and gained +3.94% since the last iBillionaire Index rebalance. The online travel giant is one billionaires David Tepper, Steve Mandel and Ray Dalio like.

The company exceeded Wall Street’s expectations with its first quarter profit report. However, it disappointed with its second quarter outlook. Priceline said currency exchange rates will “significantly reduce” its Q2 growth rates, citing weakness in the Euro and British Pound, specifically.

Four other iBillionaire Index companies have posted gains since its latest rebalance: Dow Chemical (NYSE:DOW), Dollar General (NYSE:DG), Goodyear Tire (NASDAQ:GT) and Amgen (NASDAQ:AMGN). They gained +2.73%, +2.55%, +1.05% and +0.82%, respectively.

Prior to the completion of its acquisition by Actavis (NYSE:ACT), Allergan had climbed +2.66% since rebalance.

Other index companies have had a tough go of things in recent months. Energy company Chesapeake (NYSE:CHK) plunged -27.49%. Long-time billionaire shareholder Carl Icahn has doubled down on the stock – a move that has some scratching their heads.

The share price of Whirlpool (NYSE:WHR) fell -16.14% from February 20th through May 6th, and that of Micron Technology (NASDAQ:MU) declined -12.61%. David Einhorn’s Greenlight Capital took a hit on Micron during the first quarter of the year. He addressed in his latest letter to investors, admitting that MU was the firm’s “one significant loser during the quarter.” Despite its sluggish performance, it remains one of his top positions.

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The iBillionaire Index will rebalance later this month. Perhaps the shake-up will spur a turnaround.

Learn more about the iBillionaire Index at www.iBillionaireIndex.com.

 

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