Clarification and apology: (Published 11/18/08)
On the first page of the Business section of the Sunday, Nov. 16, 2008, Post-Gazette we printed an article about Stanley Druckenmiller and his company Duquesne Capital Management. The article included headlines that suggested that the funds which Mr. Druckenmiller and Duquesne Capital manage had suffered significant losses and that Mr. Druckenmiller had been "sacked" and "took it on the chin" in the financial markets. Unfortunately, the author of the article did not check the accuracy of the facts with Mr. Druckenmiller or Duquesne Capital. According to Mr. Druckenmiller and other published reports, all of the funds managed by him and that organization have had positive returns for the year. In addition, the headlines that accompanied the story were, in hindsight, misleading and did not reflect the more qualified points made in the story itself. Simply put, we did not adhere to our own standards. We sincerely apologize to Mr. Druckenmiller and Duquesne Capital for these lapses.

With a 6-3 record and tied for the lead in the AFC North, the Pittsburgh Steelers arguably would have been a better investment than some of the other places billionaire Stanley Druckenmiller has been putting his money recently.

Doug Jones/Portland Press Herald

Stanley Druckenmiller

The most recent quarterly filing by Mr. Druckenmiller's Duquesne Capital Management indicates the successful hedge fund operator has been sacked about as often as Steelers quarterback Ben Roethlisberger. The filing, on Securities and Exchange Commission Form 13F, indicates Duquesne Capital held stocks and related securities worth $1.7 billion as of Sept. 30, down from about $5.2 billion as of June 30.

But don't jump to the conclusion that all of the $3.5 billion difference evaporated. The filing in no way constitutes a comprehensive picture of the portfolio of Mr. Druckenmiller, whose $537 million offer for a controlling interest in the Steelers was rejected by the four Rooney brothers who own those shares. Commodities contracts, currency positions, short sales, cash and other vehicles Mr. Druckenmiller and other hedge fund managers use to make money for their well-heeled clients are not required to be disclosed in quarterly 13F filings.

So the information Duquesne Capital provided to the SEC Wednesday does not reveal what the fund paid for the stock holdings it disclosed. Nor does it say anything about what else was in Mr. Druckenmiller's wallet as of Sept. 30. Nor does it shed light on the gains or losses fund investors incurred when Mr. Druckenmiller sold stocks over the summer and the extent to which he deployed the proceeds in investments he's not obligated to disclose.

Nevertheless, the filing provides insight into which stocks Mr. Druckenmiller liked in June and how his thinking changed by Sept. 30, when Wall Street's hay ride to hell began picking up steam.

For example, Duquesne Capital held 4.1 million shares of Consol Energy as of June 30 with a value of $457.5 million, making it the fund's second-largest holding at the time. But Duquesne joined other hedge funds with large positions in commodity stocks that purged their portfolios over the summer when coal stocks plunged dramatically. Consol closed at $112.37 June 30 and $45.89 on Sept. 30. By that time, Mr. Druckenmiller had liquidated his Consol holdings, according to the filing.

He also lightened up his position in Mylan, reducing Duquesne's position in the Cecil generic drug maker by 1.2 million shares over the 90-day period. As of Sept. 30, the firm owned 6.2 million Mylan shares valued at $70.9 million, making it Duquesne's seventh-largest equity position. Mylan, which closed at $11.42 on September 30, finished Friday at $9.13.

Over the third quarter, Duquesne sold more than half of its position in Chesapeake Energy, the nation's largest natural gas producer. The nearly 5.9 million shares the fund still held on Sept. 30 were worth $210.5 million at the time, based on Chesapeake's closing share price that day of $35.86. That made Chesapeake the second-largest investment in the stock portfolio, topped only by the $306.6 million in JP Morgan Chase shares Duquesne held.

However, if Mr. Druckenmiller, a diehard Steeler fan who's been known to paint his face black and gold, maintained his Chesapeake position over the next 10 days, it would have been the equivalent of the Steeler's hapless performance against the Indianapolis Colts last Sunday.

That's because Chesapeake CEO Aubrey K. McClendon disclosed Oct. 10 that in order to meet margin calls, he had to involuntarily liquidate substantially all of the 32.5 million shares he owned. The embarrassing disclosure sent Chesapeake's stock to a close of $16.52 that day. It finished Friday at $21.23, 59 percent of what a share was worth at the end of the third quarter.

After owning no shares of PNC Financial Services Group as of June 30, Duquesne placed a large bet on the proposed acquirer of National City during the third quarter. PNC was Duquesne's sixth-largest stockholding as of Sept. 30, when the shares were fetching $74.70. PNC closed Friday at $62.34.