Trillium Therapeutics Inc. (NASDAQ:TRIL): Are Hedge Funds Right About This Stock?
Out of thousands of stocks that are currently traded on the market, it is difficult to identify those that will really generate strong returns. Hedge funds and institutional investors spend millions of dollars on analysts with MBAs and PhDs, who are industry experts and well connected to other industries and media insiders on top of that. Individual investors can piggyback the hedge funds employing these talents and can benefit from their vast resources and knowledge in that way. We analyze quarterly 13F filings of nearly 750 hedge funds and, by looking at the smart money sentiment that surrounds a stock, we can determine whether it has the potential to beat the market over the long-term. Therefore, let’s take a closer look at what smart money thinks about Trillium Therapeutics Inc. (NASDAQ:TRIL).
Trillium Therapeutics Inc. (NASDAQ:TRIL) investors should be aware of an increase in hedge fund sentiment lately. TRIL was in 4 hedge funds' portfolios at the end of September. There were 3 hedge funds in our database with TRIL holdings at the end of the previous quarter. Our calculations also showed that TRIL isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
According to most traders, hedge funds are assumed to be worthless, old investment vehicles of years past. While there are over 8000 funds with their doors open at the moment, Our experts hone in on the crème de la crème of this club, approximately 750 funds. These money managers shepherd the lion's share of the hedge fund industry's total asset base, and by shadowing their top equity investments, Insider Monkey has unsheathed a number of investment strategies that have historically defeated the broader indices. Insider Monkey's flagship short hedge fund strategy outrun the S&P 500 short ETFs by around 20 percentage points annually 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_26340" align="alignnone" width="594"]
Ken Griffin of Citadel Investment Group[/caption]
We leave no stone unturned when looking for the next great investment idea. For example, Discover is offering this insane cashback card, so we look into shorting the stock. One of the most bullish analysts in America just put his money where his mouth is. He says, "I'm investing more today than I did back in early 2009." So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We even check out this option genius' weekly trade ideas. This December, we recommended Adams Energy as a one-way bet based on an under-the-radar fund manager's investor letter and the stock already gained 20 percent. With all of this in mind, we're going to take a look at the recent hedge fund action surrounding Trillium Therapeutics Inc. (NASDAQ:TRIL).
What have hedge funds been doing with Trillium Therapeutics Inc. (NASDAQ:TRIL)?
At the end of the third quarter, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 33% from the previous quarter. By comparison, 5 hedge funds held shares or bullish call options in TRIL a year ago. So, let's examine 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, Matrix Capital Management, managed by David Goel and Paul Ferri, holds the largest position in Trillium Therapeutics Inc. (NASDAQ:TRIL). Matrix Capital Management has a $0.7 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On Matrix Capital Management's heels is Baker Bros. Advisors, led by Julian Baker and Felix Baker, holding a $0.2 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that are bullish encompass Ken Griffin's Citadel Investment Group, John Overdeck and David Siegel's Two Sigma Advisors and . In terms of the portfolio weights assigned to each position Matrix Capital Management allocated the biggest weight to Trillium Therapeutics Inc. (NASDAQ:TRIL), around 0.02% of its 13F portfolio. Baker Bros. Advisors is also relatively very bullish on the stock, designating 0.0011 percent of its 13F equity portfolio to TRIL.
As one would reasonably expect, key money managers were leading the bulls' herd. Citadel Investment Group, managed by Ken Griffin, created the most outsized position in Trillium Therapeutics Inc. (NASDAQ:TRIL). Citadel Investment Group had $0 million invested in the company at the end of the quarter. John Overdeck and David Siegel's Two Sigma Advisors also initiated a $0 million position during the quarter.
Let's also examine hedge fund activity in other stocks similar to Trillium Therapeutics Inc. (NASDAQ:TRIL). We will take a look at Rexahn Pharmaceuticals, Inc. (NASDAQ:REXN), NanoViricides Inc (NYSE:NNVC), CTI Industries Corporation (NASDAQ:CTIB), and ARCA biopharma, Inc. (NASDAQ:ABIO). This group of stocks' market valuations match TRIL's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position REXN,1,224,0 NNVC,1,119,0 CTIB,1,25,0 ABIO,1,535,-1 Average,1,226,-0.25 [/table]
View the table here if you experience formatting issues.
As you can see these stocks had an average of 1 hedge funds with bullish positions and the average amount invested in these stocks was $0 million. That figure was $1 million in TRIL's case. Rexahn Pharmaceuticals, Inc. (NASDAQ:REXN) is the most popular stock in this table. On the other hand Rexahn Pharmaceuticals, Inc. (NASDAQ:REXN) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Trillium Therapeutics Inc. (NASDAQ:TRIL) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Hedge funds were also right about betting on TRIL, though not to the same extent, as the stock returned 7.1% during the fourth quarter (through the end of November) and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
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