The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds' portfolio positions as of March 31st, 2020. In this article we are going to take a look at smart money sentiment towards Global Indemnity Limited (NASDAQ:GBLI).
Global Indemnity Limited (NASDAQ:GBLI) shareholders have witnessed a decrease in activity from the world's largest hedge funds recently. GBLI was in 4 hedge funds' portfolios at the end of March. There were 6 hedge funds in our database with GBLI positions at the end of the previous quarter. Our calculations also showed that GBLI isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). Video: Watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most traders, hedge funds are perceived as unimportant, old investment vehicles of years past. While there are greater than 8000 funds trading at the moment, We look at the crème de la crème of this club, about 850 funds. It is estimated that this group of investors manage most of the smart money's total asset base, and by shadowing their inimitable equity investments, Insider Monkey has figured out several investment strategies that have historically outstripped Mr. Market. Insider Monkey's flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
[caption id="attachment_338410" align="aligncenter" width="393"] Jeffrey Bronchick of Cove Street Capital[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, we believe electric vehicles and energy storage are set to become giant markets, and we want to take advantage of the declining lithium prices amid the COVID-19 pandemic. So we are checking out investment opportunities like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind let's analyze the recent hedge fund action regarding Global Indemnity Limited (NASDAQ:GBLI).
Hedge fund activity in Global Indemnity Limited (NASDAQ:GBLI)
Heading into the second quarter of 2020, a total of 4 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -33% from the previous quarter. By comparison, 6 hedge funds held shares or bullish call options in GBLI a year ago. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Springhouse Capital Management, managed by Brian Gaines, holds the number one position in Global Indemnity Limited (NASDAQ:GBLI). Springhouse Capital Management has a $18.3 million position in the stock, comprising 22.7% of its 13F portfolio. Sitting at the No. 2 spot is Renaissance Technologies, with a $3.7 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other peers with similar optimism encompass Raymond J. Harbert's Harbert Management, Jeffrey Bronchick's Cove Street Capital and . In terms of the portfolio weights assigned to each position Springhouse Capital Management allocated the biggest weight to Global Indemnity Limited (NASDAQ:GBLI), around 22.7% of its 13F portfolio. Harbert Management is also relatively very bullish on the stock, setting aside 3.24 percent of its 13F equity portfolio to GBLI.
Because Global Indemnity Limited (NASDAQ:GBLI) has witnessed declining sentiment from hedge fund managers, it's safe to say that there lies a certain "tier" of money managers that elected to cut their entire stakes in the third quarter. Intriguingly, Ken Griffin's Citadel Investment Group said goodbye to the biggest position of the 750 funds watched by Insider Monkey, worth about $0.3 million in stock. Israel Englander's fund, Millennium Management, also dropped its stock, about $0.2 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds in the third quarter.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Global Indemnity Limited (NASDAQ:GBLI) but similarly valued. We will take a look at Seneca Foods Corp (NASDAQ:SENEA), ViewRay, Inc. (NASDAQ:VRAY), Clean Energy Fuels Corp (NASDAQ:CLNE), and Caesarstone Ltd (NASDAQ:CSTE). All of these stocks' market caps are closest to GBLI's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SENEA,7,25303,0 VRAY,12,81516,-10 CLNE,8,18073,-2 CSTE,10,14694,1 Average,9.25,34897,-2.75 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $35 million. That figure was $25 million in GBLI's case. ViewRay, Inc. (NASDAQ:VRAY) is the most popular stock in this table. On the other hand Seneca Foods Corp (NASDAQ:SENEA) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Global Indemnity Limited (NASDAQ:GBLI) is even less popular than SENEA. Hedge funds dodged a bullet by taking a bearish stance towards GBLI. Our calculations showed that the top 10 most popular hedge fund stocks returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 8.3% in 2020 through the end of May but managed to beat the market by 13.2 percentage points. Unfortunately GBLI wasn't nearly as popular as these 10 stocks (hedge fund sentiment was very bearish); GBLI investors were disappointed as the stock returned -4.9% during the second quarter (through the end of May) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market so far in 2020.
Disclosure: None. This article was originally published at Insider Monkey.