Big firms among top losers

By Svea Herbst-Bayliss

BOSTON (Reuters) - Some of America's biggest and best-known mutual fund companies likely suffered heavy losses multiple times this week because they had large holdings in the market's worst performing stocks.

AllianceBernstein (AB.N), which invests $675 billion (385 billion pounds), may have been the biggest casualty. It ranked as the top shareholder in ailing investment bank Lehman Brothers LEH.N, where it owned 65.6 million shares, and crippled mortgage company Fannie Mae (FNM.N), where it owned 134.2 million shares, at the end of June.

At Fannie's cousin Freddie Mac (FRE.N), AllianceBernstein was the third biggest holder with 41 million shares.

On Tuesday, Lehman's stock tumbled 46 percent, while Fannie Mae cratered 90 percent, and Freddie Mac plunged 85 percent on Monday. While the companies' share prices have recovered somewhat, losses remain enormous overall, with Fannie having given up early all of its value in the last 52 weeks, for example.

Fidelity Investments, the world's biggest mutual fund company with $1.5 trillion invested had also loaded up on this week's losers. The privately held company ranked as the third largest investor in Lehman and the fourth biggest owner at Fannie. At Freddie, Fidelity ranked in 10th position.

Capital Group, which runs the popular American Funds, was the second biggest investor in Freddie Mac and the third biggest in Fannie Mae. And Legg Mason Inc, home to Bill Miller who was ranked as America's best stock picker for 15 years, held more Freddie shares than anyone else, while Legg's ClearBridge unit was the second biggest owner of Lehman stock.

"Fidelity and Capital Group are so big that they are bound to be among the biggest owners in whatever they own," said Morningstar analyst Christopher Davis.

And hedge fund manager George Soros could have lost as much as $84.7 million this week alone if he still owns the 9.47 million shares of Lehman he bought in the second quarter.