We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn't mean that they don't have occasional colossal losses; they do (like Peltz's recent General Electric losses). However, it is still a good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards Quanterix Corporation (NASDAQ:QTRX).
Quanterix Corporation (NASDAQ:QTRX) has seen an increase in support from the world's most elite money managers of late. QTRX was in 8 hedge funds' portfolios at the end of the second quarter of 2019. There were 7 hedge funds in our database with QTRX positions at the end of the previous quarter. Our calculations also showed that QTRX isn't among the 30 most popular stocks among hedge funds (see the video below). Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
To most stock holders, hedge funds are assumed to be unimportant, outdated financial tools of the past. While there are greater than 8000 funds trading today, Our researchers look at the leaders of this club, approximately 750 funds. These investment experts direct the majority of all hedge funds' total asset base, and by watching their top stock picks, Insider Monkey has found several investment strategies that have historically surpassed the market. Insider Monkey's flagship hedge fund strategy outpaced the S&P 500 index by around 5 percentage points annually since its inception in May 2014. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 25.7% since February 2017 (through September 30th) even though the market was up more than 33% during the same period. We just shared a list of 10 short targets in our latest quarterly update .
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn't rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let's view the recent hedge fund action surrounding Quanterix Corporation (NASDAQ:QTRX).
What have hedge funds been doing with Quanterix Corporation (NASDAQ:QTRX)?
At the end of the second quarter, a total of 8 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 14% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in QTRX over the last 16 quarters. With hedgies' sentiment swirling, there exists a select group of key hedge fund managers who were upping their holdings significantly (or already accumulated large positions).
The largest stake in Quanterix Corporation (NASDAQ:QTRX) was held by Royce & Associates, which reported holding $20.7 million worth of stock at the end of March. It was followed by Platinum Asset Management with a $4.8 million position. Other investors bullish on the company included Millennium Management, Citadel Investment Group, and Point72 Asset Management.
As aggregate interest increased, key hedge funds have been driving this bullishness. Algert Coldiron Investors, managed by Peter Algert and Kevin Coldiron, created the most outsized position in Quanterix Corporation (NASDAQ:QTRX). Algert Coldiron Investors had $0.5 million invested in the company at the end of the quarter. Renaissance Technologies also initiated a $0.2 million position during the quarter.
Let's check out hedge fund activity in other stocks similar to Quanterix Corporation (NASDAQ:QTRX). These stocks are Banco Latinoamericano de Comercio Exterior, S.A. (NYSE:BLX), Lindblad Expeditions Holdings Inc (NASDAQ:LIND), ACCO Brands Corporation (NYSE:ACCO), and NetGear, Inc. (NASDAQ:NTGR). This group of stocks' market caps are similar to QTRX's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position BLX,1,6963,0 LIND,15,190272,-5 ACCO,16,37871,-2 NTGR,11,11253,-5 Average,10.75,61590,-3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 10.75 hedge funds with bullish positions and the average amount invested in these stocks was $62 million. That figure was $38 million in QTRX's case. ACCO Brands Corporation (NYSE:ACCO) is the most popular stock in this table. On the other hand Banco Latinoamericano de Comercio Exterior, S.A. (NYSE:BLX) is the least popular one with only 1 bullish hedge fund positions. Quanterix Corporation (NASDAQ:QTRX) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and 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 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately QTRX wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); QTRX investors were disappointed as the stock returned -35% during the third quarter 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 in 2019.
Disclosure: None. This article was originally published at Insider Monkey.