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Nehal Chopra’s Ratan Capital Group’s Returns, AUM, and Holdings

Nina Zdinjak

Ratan Capital Group is a New York-based hedge fund, founded back in 2009 by Nehal Chopra. Prior to starting her own firm, Nehal Chopra accumulated her investment knowledge at Balyasny Asset Management L.P and Ramius Capital Group, to name a few former employers. Nehal Chopra holds an M.B.A. in Finance and  Entrepreneurial Management, and a B.Sc. in Economics, Finance, and Management from the University of Pennsylvania - The Wharton School.

At the time of its founding, her fund was actually named Tiger Ratan Capital Management, as it was supported with a $25 million investment by hedge fund legend Julian Robertson of Tiger Management, through its Tiger Accelerator fund. Chopra's fund was renamed Ratan Capital Group after Robertson drew back his investment in 2016. Ratan Capital Group has had many good years in terms of returns, which lead to Nehal Chopra being named an Institutional Investor Hedge Fund Rising Star.

Nehal Chopra Tiger Ratan Capital Group

Unfortunately, her reputation took a bit of a hit at the end of 2017, when Chopra and Ratan Capital Group agreed to pay $400,000 total ($200,000 each) to settle the SEC’s accusations that Chopra's husband, Paritosh Gupta, who was part of Brahman Capital’s team at the time, had shared confidential investment ideas with her. Paritosh Gupta was charged $250,000, while Brahman Capital agreed to pay a $250,000 penalty for not properly overseeing Mr. Gupta. The SEC claimed that Gupta shared “investment theses, models, notes, recommendations, and analyses” with Nehal Chopra that were created for Brahman Capital’s clients. Even though the couple neither confirmed or denied the allegations, the couple agreed to pay the fines in order to settle.

Whether the allegations were true or not, Ratan Capital Group delivered some amazing returns during those controversial years. It generated fantastic returns of 26.3% in 2012, 46.8% in 2013, and 22.3% in 2014. The following year was a down one for the fund, as it lost 19%. A disastrous 51.9% loss hit the fund and its clients hard between May 2015 to June 2016, mainly because of big bets on Valeant, which lost more than 61% from August 2015 until the end of that year. According to the fund’s plain brochure, it had around $375.46 million in assets under management on December 31, 2016. Its 13F portfolio was valued at $222.35 million at the end of June 2018.

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During the second quarter of 2018, Ratan Capital Group made several changes to its equity portfolio. It added 18 new companies, raised its stakes in four stocks, reduced the size of four positions, and dumped 12 stocks. More details about the fund’s investment moves during the second quarter can be read on the next page.

The largest new addition to Ratan Capital's portfolio in the second quarter was Ceridian Hcm Hldg Inc (CDAY), in which the fund acquired a position that was worth around $24.75 million and counted 745,850 shares. The second-largest new stake was in Weight Watchers International Inc (WTW), as the fund acquired 110,951 shares valued at $11.21 million.

Avaya Holdings Corp (AVYA) raised the fund’s enthusiasm during the second quarter, as Ratan boosted its stake in the company by 51% to 1.2 million shares worth $24.07 million on June 30. Netflix Inc (NFLX) also managed to attract a larger investment from Ratan Capital Group, as the fund raised its stake by 46% to 16,100 shares worth $6.30 million.

The fund significantly lowered its stake in Cott Corp (COT) during the second quarter, to 197,700 shares, worth around $3.27 million, which was down by 55% from the start of the quarter. It also reduced its stake in Viavi Solutions Inc (VIAV) by 43% to 1.30 million shares valued at $13.33 million.

Lastly, Ratan Capital said goodbye to 12 stocks during the second quarter, out of which the biggest positions were in NRG Energy, Inc. (NRG) and Vistra Energy Corp (VST), counting 290,922 shares worth around $8.88 million and 356,952 shares valued at $7.44 million, respectively. Interestingly, while Ratan Capital Group decided to dump Vistra Energy Corp (VST) during the second quarter, the smart money investors tracked by Insider Monkey’s database have become more bullish on it, with 43 hedge funds long the stock at the end of June versus 35 at the end of March. Time will tell if Ms. Chopra sold out of that stock too early.

Disclosure: None. This article was originally published on Insider Monkey.