As we already know from media reports and hedge fund investor letters, many hedge funds lost money in fourth quarter, blaming macroeconomic conditions and unpredictable events that hit several sectors, with technology among them. Nevertheless, most investors decided to stick to their bullish theses and recouped their losses by the end of the first quarter. We get to see hedge funds' thoughts towards the market and individual stocks by aggregating their quarterly portfolio movements and reading their investor letters. In this article, we will particularly take a look at what hedge funds think about Credicorp Ltd. (NYSE:BAP).
Credicorp Ltd. (NYSE:BAP) was in 20 hedge funds' portfolios at the end of March. BAP shareholders have witnessed an increase in hedge fund interest of late. There were 14 hedge funds in our database with BAP holdings at the end of the previous quarter. Our calculations also showed that bap isn't among the 30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We're going to go over the latest hedge fund action surrounding Credicorp Ltd. (NYSE:BAP).
What does the smart money think about Credicorp Ltd. (NYSE:BAP)?
Heading into the second quarter of 2019, a total of 20 of the hedge funds tracked by Insider Monkey were long this stock, a change of 43% from the fourth quarter of 2018. On the other hand, there were a total of 16 hedge funds with a bullish position in BAP a year ago. With the smart money's positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
The largest stake in Credicorp Ltd. (NYSE:BAP) was held by Generation Investment Management, which reported holding $305.9 million worth of stock at the end of March. It was followed by Fisher Asset Management with a $275.8 million position. Other investors bullish on the company included AQR Capital Management, Driehaus Capital, and Citadel Investment Group.
As one would reasonably expect, specific money managers were leading the bulls' herd. Citadel Investment Group, managed by Ken Griffin, established the biggest position in Credicorp Ltd. (NYSE:BAP). Citadel Investment Group had $22.1 million invested in the company at the end of the quarter. Jim Simons's Renaissance Technologies also made a $2.4 million investment in the stock during the quarter. The following funds were also among the new BAP investors: Noam Gottesman's GLG Partners, Jeffrey Talpins's Element Capital Management, and David Costen Haley's HBK Investments.
Let's check out hedge fund activity in other stocks similar to Credicorp Ltd. (NYSE:BAP). These stocks are Newmont Goldcorp Corporation (NYSE:NEM), Best Buy Co., Inc. (NYSE:BBY), Essex Property Trust Inc (NYSE:ESS), and AMETEK, Inc. (NYSE:AME). This group of stocks' market values resemble BAP's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NEM,35,787316,4 BBY,35,1130058,12 ESS,16,447378,-3 AME,29,1038604,-3 Average,28.75,850839,2.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 28.75 hedge funds with bullish positions and the average amount invested in these stocks was $851 million. That figure was $762 million in BAP's case. Newmont Goldcorp Corporation (NYSE:NEM) is the most popular stock in this table. On the other hand Essex Property Trust Inc (NYSE:ESS) is the least popular one with only 16 bullish hedge fund positions. Credicorp Ltd. (NYSE:BAP) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 20 most popular stocks among hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. A small number of hedge funds were also right about betting on BAP, though not to the same extent, as the stock returned 0.8% during the same time frame and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.