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First Eagle is Betting on Bank of New York Mellon (BK) Stock

Alex Smith
·3 min read

First Eagle Investment Management recently released its Q3 2020 Investor Letter, a copy of which you can download here. The First Eagle Global Fund A Shares posted a return of 5.64% for the third quarter (without sales charge), underperforming its benchmark, the MSCI World Index which returned 7.93% in the same quarter. You should check out First Eagle's top 5 stock picks for investors to buy right now, which could be the biggest winners of this year.

In the said letter, First Eagle highlighted a few stocks and Bank Of New York Mellon Corp (NYSE:BK) is one of them. Bank Of New York Mellon Corp (NYSE:BK) is a corporate investment banking company. Year-to-date, Bank Of New York Mellon Corp (NYSE:BK) stock lost 33% and on October 29th it had a closing price of $34.32. Here is what First Eagle said:

"The world’s largest custody bank, Bank of New York Mellon has been challenged by the persistently low-rate environment. While custody tends to be a wide-moat business, revenue generation is highly sensitive to net interest margins. Low rates have also hurt Bank of New York’s other primary line of business—investment management—as it has been forced to waive fees on its money market funds to preserve their net asset value."

Is PPBI A Good Stock To Buy?
Is PPBI A Good Stock To Buy?

In Q2 2020, the number of bullish hedge fund positions on Bank Of New York Mellon Corp (NYSE:BK) stock decreased by about 8% from the previous quarter (see the chart here), so a number of other hedge fund managers don't believe in BK's growth potential. Our calculations showed that Bank Of New York Mellon Corp (NYSE:BK) isn't ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds' poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free enewsletter below to receive our stories in your inbox:

Disclosure: None. This article is originally published at Insider Monkey.