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 more than 750 13F filings submitted by hedge funds and prominent investors. These filings show these funds' portfolio positions as of September 30th, 2019. In this article we are going to take a look at smart money sentiment towards Scully Royalty Ltd. (NYSE:SRL).
Scully Royalty Ltd. (NYSE:SRL) shares haven't seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 2 hedge funds' portfolios at the end of September. The level and the change in hedge fund popularity aren't the only variables you need to analyze to decipher hedge funds' perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That's why at the end of this article we will examine companies such as Colony Bankcorp Inc (NASDAQ:CBAN), StoneCastle Financial Corp (NASDAQ:BANX), and G. Willi-Food International Limited (NASDAQ:WILC) to gather more data points. Our calculations also showed that SRL 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.
According to most traders, hedge funds are seen as slow, outdated financial vehicles of years past. While there are over 8000 funds trading at the moment, Our researchers choose to focus on the leaders of this group, about 750 funds. Most estimates calculate that this group of people administer the majority of the smart money's total capital, and by tailing their best picks, Insider Monkey has discovered various investment strategies that have historically outperformed Mr. Market. Insider Monkey's flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per year since its inception in May 2014. Our portfolio of short stocks lost 27.8% since February 2017 (through November 21st) even though the market was up more than 39% during the same period. We just shared a list of 7 short targets in our latest quarterly update .
[caption id="attachment_26286" align="aligncenter" width="359"] Jim Simons founder of Renaissance Technologies[/caption]
We're going to take a gander at the latest hedge fund action encompassing Scully Royalty Ltd. (NYSE:SRL).
How have hedgies been trading Scully Royalty Ltd. (NYSE:SRL)?
At the end of the third quarter, a total of 2 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from the second quarter of 2019. Below, you can check out the change in hedge fund sentiment towards SRL over the last 17 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Scully Royalty Ltd. (NYSE:SRL) was held by Nantahala Capital Management, which reported holding $9.8 million worth of stock at the end of September. It was followed by Renaissance Technologies with a $0.8 million position.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren't any hedge funds dumping their holdings during the third quarter, there weren't any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven't identified any viable catalysts that can attract investor attention.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Scully Royalty Ltd. (NYSE:SRL) but similarly valued. We will take a look at Colony Bankcorp Inc (NASDAQ:CBAN), StoneCastle Financial Corp (NASDAQ:BANX), G. Willi-Food International Limited (NASDAQ:WILC), and The ExOne Company (NASDAQ:XONE). This group of stocks' market caps are similar to SRL's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CBAN,3,9572,-1 BANX,1,222,0 WILC,2,18900,0 XONE,4,1501,-1 Average,2.5,7549,-0.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 2.5 hedge funds with bullish positions and the average amount invested in these stocks was $8 million. That figure was $11 million in SRL's case. The ExOne Company (NASDAQ:XONE) is the most popular stock in this table. On the other hand StoneCastle Financial Corp (NASDAQ:BANX) is the least popular one with only 1 bullish hedge fund positions. Scully Royalty Ltd. (NYSE:SRL) 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 34.7% in 2019 through November 22nd and outperformed the S&P 500 ETF (SPY) by 8.5 percentage points. Unfortunately SRL wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); SRL investors were disappointed as the stock returned -14.8% during the fourth quarter (through 11/22) 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 70 percent of these stocks already outperformed the market in Q4.
Disclosure: None. This article was originally published at Insider Monkey.