Nothing corny about SAC's ethanol returns

Thu Jun 1, 2006



Blame it on fear of $100-a-barrel oil or a 60 Minutes TV spot in May about ethanol catching on in Latin America. Either way, the prospect of someday filling your SUV's tank with corn syrup before heading off on a summer drive to the Hamptons seems to be a growing possibility - or at least, the folks at Steve Cohen's SAC Capital Advisors think so.

Regulatory filings with the U.S. Securities and Exchange Commission show that SAC is really filling up its portfolio with ethanol producers that are pumping out high-octane returns. Archer Daniels Midland is by far the biggest North American supplier of ethanol with a whopping 25% of the U.S. biodiesel market, and SAC is all over the stock. At the start of April, SAC held 87,500 shares of Archer Daniels Midland worth $2.9 million, up from a smaller 30,800-share stake in the company at the start of 2006,...

ISSN: 2151-1845 / CDC10004H

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