The 700+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the first quarter, which unveil their equity positions as of March 31. 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 RealNetworks Inc (NASDAQ:RNWK).
RealNetworks Inc (NASDAQ:RNWK) was in 10 hedge funds' portfolios at the end of the first quarter of 2019. RNWK has experienced an increase in enthusiasm from smart money in recent months. There were 7 hedge funds in our database with RNWK holdings at the end of the previous quarter. Our calculations also showed that RNWK isn't among the 30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. 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.
[caption id="attachment_747612" align="aligncenter" width="473"] Eric Singer of VIEX Capital[/caption]
We're going to take a glance at the new hedge fund action encompassing RealNetworks Inc (NASDAQ:RNWK).
What have hedge funds been doing with RealNetworks Inc (NASDAQ:RNWK)?
At the end of the first quarter, a total of 10 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 43% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards RNWK over the last 15 quarters. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in RealNetworks Inc (NASDAQ:RNWK) was held by Ariel Investments, which reported holding $20.6 million worth of stock at the end of March. It was followed by VIEX Capital Advisors with a $8.1 million position. Other investors bullish on the company included Renaissance Technologies, Ancora Advisors, and Millennium Management.
Now, key money managers were breaking ground themselves. Citadel Investment Group, managed by Ken Griffin, created the most valuable position in RealNetworks Inc (NASDAQ:RNWK). Citadel Investment Group had $0.1 million invested in the company at the end of the quarter. Michael Platt and William Reeves's BlueCrest Capital Mgmt. also made a $0.1 million investment in the stock during the quarter. The only other fund with a brand new RNWK position is Matthew Hulsizer's PEAK6 Capital Management.
Let's check out hedge fund activity in other stocks similar to RealNetworks Inc (NASDAQ:RNWK). We will take a look at Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS), County Bancorp, Inc. (NASDAQ:ICBK), Castle Brands Inc (NYSE:ROX), and Luna Innovations Incorporated (NASDAQ:LUNA). This group of stocks' market values resemble RNWK's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CRVS,7,38492,-2 ICBK,3,4881,1 ROX,4,1001,0 LUNA,2,5344,-1 Average,4,12430,-0.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 4 hedge funds with bullish positions and the average amount invested in these stocks was $12 million. That figure was $36 million in RNWK's case. Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS) is the most popular stock in this table. On the other hand Luna Innovations Incorporated (NASDAQ:LUNA) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks RealNetworks Inc (NASDAQ:RNWK) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately RNWK wasn't nearly as popular as these 20 stocks and hedge funds that were betting on RNWK were disappointed as the stock returned -38.9% during the same period 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 13 of these stocks already outperformed the market in Q2.
Disclosure: None. This article was originally published at Insider Monkey.