Last week, the Opportunity Equity lost 1.75%, underperforming the S&P 500’s 1.08% decline (Exhibit 1). The strategy ended the week up 0.82% YTD, or 1114 basis points behind the S&P 500.
Exhibit 1: Preliminary Performance of LMM Opportunity Equity Strategy Versus Equity Indices, Through 12/30/161
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (12/23 - 12/30) | -1.75% | -1.08% |
| MTD | 1.37% | 1.98% |
| QTD | 1.90% | 3.82% |
| YTD | 0.82% | 11.96% |
| Inception (annualized since 12/30/99) | 6.04% | 4.53% |
Source: Bloomberg, LMM
Pangaea One L.P., a private equity fund we hold, was a top contributor last week as Pangaea Logistics Solutions Inc. (PANL), one of its holdings, climbed 27% during the week. There was minimal news on the other top contributors.
Exhibit 2: Significant Contributors to Performance, 12/23/16 - 12/30/16
| Name | Type | Return |
| *New Security* | Equity | 5.5% |
| Platform Specialty Products Corp | Equity | 2.1% |
| Pangaea One L.P. | Private | 5.5% |
| Valeant Pharmaceuticals Intl Inc | Equity | 1.2% |
| *New Security* | Equity | 1.7% |
Source: LMM LLC.
Intrexon Corp. (XON) declined last week after announcing a special stock dividend of 53.3M shares of AquaBounty Technologies Inc. In addition, Northland Capital Markets initiated coverage of XON placing an outperform rating on the common stock. American Airlines Group Inc. (AAL) was down during the week following CEO Doug Parker’s exercise of options and subsequent sale of the common stock as part of a Rule 10b5-1 plan. Ziopharm Oncology (ZIOP) dropped below the 100-day moving average early last week. Endurance International Group Holdings (EIGI) announced the commencement of an exchange offer for all of the outstanding 10.875% Senior Notes due 2024. There was no significant news on Genworth Financial (GNW).
Exhibit 3: Significant Detractors from Performance, 12/23/16 - 12/30/16
| Name | Type | Return |
| Intrexon Corp | Equity | -5.7% |
| Genworth Financial Inc. | Equity | -5.7% |
| American Airlines Group Inc. | Equity | -3.7% |
| Ziopharm Oncology Inc. | Equity | -9.2% |
| Endurance International Group Holdings | Equity | -3.6% |
Source: LMM LLC.
1The performance figures reflect the deduction of a model investment management fee of 1% (the highest fee for separate accounts under our fee schedule) and certain other expenses. For important additional information about Opportunity Equity performance, please click on the Opportunity Equity Composite Performance Disclosure. The performance returns shown in this report are preliminary and are subject to revision. Past performance is no guarantee of future results.
Significant Contributors and Significant Detractors are the Strategy holdings that had the greatest effect on Strategy performance for the week. Holdings that have been in the Strategy since the end of the most recent calendar quarter are identified by name. For information on how Contributor/Detractor data were calculated and a list showing the contribution to the Strategy's weekly performance of each investment held at such quarter end, contact LMM.
Any views expressed are subject to change at any time, and LMM disclaims any responsibility to update such views. The information presented should not be considered a recommendation to purchase or sell any security and should not be relied upon as investment advice. It should not be assumed that any purchase or sale decisions will be profitable or will equal the performance of any security mentioned. Past performance is no guarantee of future results, and there is no guarantee dividends will be paid or continued.
©2017 LMM LLC. LMM LLC is owned by Bill Miller and Legg Mason, Inc.
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