Tale of 2 Investors Reflects Split in Market

Rich investors apparently aren’t all that different from the rest of us--they’re facing the same split market, on a bigger scale.

George Soros’ flagship $9.9-billion Quantum Fund is rounding out its best year since 1995, gaining 32% through Wednesday--thanks to winning bets on technology shares such as Qualcomm Inc.

But “value” investor Julian Robertson’s hedge fund has dropped 22.5%, losing money for the second straight year as his biggest holdings bombed.

The split between the two vaunted investors underscores how surging Internet and telecommunications shares have left stock pickers who seek bargains in the dust. Robertson’s Tiger Management now manages $8 billion, less than half Soros’ $17.3 billion. In mid-1998, the two were about even in size.

“Most [hedge] funds have been shifting strategies, investing in technology and initial public offerings more than ever,” said Roland Lorenzo, president and chief operating officer of Credit Suisse First Boston Index Co., which publishes a hedge fund index.

That’s what Stanley Druckenmiller did. Druckenmiller, who manages Soros’ Quantum Fund, has turned the fund around after it lost 5% in the year’s first 10 months. The fund, which can invest in anything--including global stocks, currencies, and commodities--rebounded by snapping up tech shares.

According to third-quarter Securities and Exchange Commission filings, Soros Fund Management held Qualcomm, which has nearly tripled since October and is this year’s biggest gainer on the Standard & Poor’s 500 index. Other stocks in its portfolio were Sun Microsystems Inc., Veritas Software Corp. and Parametric Technology Corp., which have gained 43% to 95% since Oct. 29.

This year has been Robertson’s biggest loser since he opened Tiger in 1980. In 19 years, Tiger has returned an average of about 26% annually.

As a value investor, Robertson seeks stocks that are cheap in relation to company earnings. His biggest holding, U.S. Airways Group Inc., has tumbled 37% this year.