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The 700+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the third quarter, which unveil their equity positions as of September 30. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards BrightSphere Investment Group Inc. (NYSE:BSIG).
BrightSphere Investment Group Inc. (NYSE:BSIG) was in 21 hedge funds' portfolios at the end of September. BSIG investors should pay attention to an increase in hedge fund sentiment recently. There were 19 hedge funds in our database with BSIG holdings at the end of the previous quarter. Our calculations also showed that BSIG isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
In today’s marketplace there are a large number of signals stock traders put to use to grade stocks. A pair of the most under-the-radar signals are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the top picks of the top fund managers can outperform their index-focused peers by a solid margin (see the details here).
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John Paulson of Paulson & Co[/caption]
Unlike the largest US hedge funds that are convinced Dow will soar past 40,000 or the world's most bearish hedge fund that's more convinced than ever that a crash is coming, our long-short investment strategy doesn't rely on bull or bear markets to deliver double digit returns. We only rely on the best performing hedge funds' buy/sell signals. Let's review the new hedge fund action encompassing BrightSphere Investment Group Inc. (NYSE:BSIG).
What does smart money think about BrightSphere Investment Group Inc. (NYSE:BSIG)?
At Q3's end, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 11% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards BSIG over the last 17 quarters. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, John Paulson's Paulson & Co has the largest position in BrightSphere Investment Group Inc. (NYSE:BSIG), worth close to $198.2 million, amounting to 4% of its total 13F portfolio. The second largest stake is held by Nathaniel August of Mangrove Partners, with a $26 million position; the fund has 3.2% of its 13F portfolio invested in the stock. Remaining professional money managers with similar optimism encompass Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital, Steve Cohen's Point72 Asset Management and John Overdeck and David Siegel's Two Sigma Advisors. In terms of the portfolio weights assigned to each position Paulson & Co allocated the biggest weight to BrightSphere Investment Group Inc. (NYSE:BSIG), around 3.97% of its 13F portfolio. Mangrove Partners is also relatively very bullish on the stock, designating 3.16 percent of its 13F equity portfolio to BSIG.
With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. Paulson & Co, managed by John Paulson, established the most valuable position in BrightSphere Investment Group Inc. (NYSE:BSIG). Paulson & Co had $198.2 million invested in the company at the end of the quarter. Nathaniel August's Mangrove Partners also initiated a $26 million position during the quarter. The following funds were also among the new BSIG investors: Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital, Steve Cohen's Point72 Asset Management, and John Overdeck and David Siegel's Two Sigma Advisors.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as BrightSphere Investment Group Inc. (NYSE:BSIG) but similarly valued. These stocks are Corindus Vascular Robotics Inc (NYSE:CVRS), Y-mAbs Therapeutics, Inc. (NASDAQ:YMAB), Ambac Financial Group, Inc. (NASDAQ:AMBC), and Nova Measuring Instruments Ltd. (NASDAQ:NVMI). This group of stocks' market valuations are closest to BSIG's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CVRS,21,291630,12 YMAB,8,60479,1 AMBC,14,108465,0 NVMI,10,167598,1 Average,13.25,157043,3.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.25 hedge funds with bullish positions and the average amount invested in these stocks was $157 million. That figure was $275 million in BSIG's case. Corindus Vascular Robotics Inc (NYSE:CVRS) is the most popular stock in this table. On the other hand Y-mAbs Therapeutics, Inc. (NASDAQ:YMAB) is the least popular one with only 8 bullish hedge fund positions. BrightSphere Investment Group Inc. (NYSE:BSIG) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately BSIG wasn't nearly as popular as these 20 stocks and hedge funds that were betting on BSIG were disappointed as the stock returned -2.8% during the fourth quarter (through the end of November) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.