Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the second quarter. You can find write-ups about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves and analyze what the smart money thinks of SINA Corp (NASDAQ:SINA) based on that data.
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Today there are a large number of indicators stock market investors have at their disposal to analyze stocks. A pair of the most useful indicators are hedge fund and insider trading sentiment. Our experts have shown that, historically, those who follow the top picks of the elite investment managers can outperform their index-focused peers by a superb margin (see the details here).
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 take a look at the latest hedge fund action encompassing SINA Corp (NASDAQ:SINA).
How have hedgies been trading SINA Corp (NASDAQ:SINA)?
At the end of the second quarter, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of -21% from the first quarter of 2019. By comparison, 28 hedge funds held shares or bullish call options in SINA a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey's hedge fund database, D. E. Shaw's D E Shaw has the biggest position in SINA Corp (NASDAQ:SINA), worth close to $77 million, accounting for 0.1% of its total 13F portfolio. Coming in second is HBK Investments, managed by David Costen Haley, which holds a $62.6 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Other peers that are bullish comprise Charles de Vaulx's International Value Advisers, Noam Gottesman's GLG Partners and Kerr Neilson's Platinum Asset Management.
Due to the fact that SINA Corp (NASDAQ:SINA) has experienced declining sentiment from the smart money, it's safe to say that there lies a certain "tier" of fund managers who were dropping their entire stakes in the second quarter. Intriguingly, Larry Chen and Terry Zhang's Tairen Capital dumped the biggest stake of the 750 funds followed by Insider Monkey, totaling an estimated $67.1 million in stock, and Renaissance Technologies was right behind this move, as the fund cut about $34.1 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 5 funds in the second quarter.
Let's now take a look at hedge fund activity in other stocks similar to SINA Corp (NASDAQ:SINA). We will take a look at Acadia Healthcare Company Inc (NASDAQ:ACHC), Chesapeake Energy Corporation (NYSE:CHK), Texas Capital Bancshares Inc (NASDAQ:TCBI), and FireEye Inc (NASDAQ:FEYE). This group of stocks' market values match SINA's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ACHC,17,593650,-2 CHK,18,96204,-2 TCBI,19,237820,0 FEYE,29,345965,2 Average,20.75,318410,-0.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 20.75 hedge funds with bullish positions and the average amount invested in these stocks was $318 million. That figure was $314 million in SINA's case. FireEye Inc (NASDAQ:FEYE) is the most popular stock in this table. On the other hand Acadia Healthcare Company Inc (NASDAQ:ACHC) is the least popular one with only 17 bullish hedge fund positions. SINA Corp (NASDAQ:SINA) 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 SINA wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); SINA investors were disappointed as the stock returned -9.1% 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.
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