Magellan Further Cuts Tech Stake

Fidelity Investment’s Magellan Fund, whose moves are closely watched by Wall Street because of its immense size, further reduced its holdings in technology stocks in November--just before a big sell-off in the sector.

The $50-billion mutual fund, the nation’s largest, cut its stake in technology stocks to 24.5% of its holdings at the end of November from 43.2% at the end of October, according to Fidelity’s monthly mutual fund guide published this week.

Investors had long feared that Magellan’s move out of tech would induce a massive sell-off in the sector, but the fund guide shows that manager Jeffrey Vinik cut his tech holdings before the shares collapsed in December and this month. Vinik, however, has since been criticized for publicly “talking up” some tech stocks even as he was dumping them in October and November.

Magellan’s top 10 investment holdings are now crowded with Standard & Poor’s 500-index futures and U.S. bonds, rather than technology companies such as IBM and Micron Technology.