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. What do these smart investors think about Unum Therapeutics Inc. (NASDAQ:UMRX)?
Hedge fund interest in Unum Therapeutics Inc. (NASDAQ:UMRX) shares was flat at the end of last quarter. This is usually a negative indicator. 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 Westell Technologies Inc. (NASDAQ:WSTL), Sky Solar Holdings, Ltd. (NASDAQ:SKYS), and Check-Cap Ltd. (NASDAQ:CHEK) to gather more data points. Our calculations also showed that UMRX 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.
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 was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 44 percentage points since March 2017 (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 36% through May 18th. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
[caption id="attachment_27480" align="aligncenter" width="400"] Israel Englander of Millennium Management[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, legendary investor Bill Miller told investors to sell 7 extremely popular recession stocks last month. So, we went through his list and recommended another stock with 100% upside potential instead. We interview hedge fund managers and ask them about their best ideas. You can watch our latest hedge fund manager interview here and find out the name of the large-cap healthcare stock that Sio Capital's Michael Castor expects to double. 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 S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let's take a look at the latest hedge fund action surrounding Unum Therapeutics Inc. (NASDAQ:UMRX).
What does smart money think about Unum Therapeutics Inc. (NASDAQ:UMRX)?
At Q1's end, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the fourth quarter of 2019. On the other hand, there were a total of 6 hedge funds with a bullish position in UMRX a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Renaissance Technologies was the largest shareholder of Unum Therapeutics Inc. (NASDAQ:UMRX), with a stake worth $0.1 million reported as of the end of September. Trailing Renaissance Technologies was Millennium Management, which amassed a stake valued at $0.1 million. Citadel Investment Group was also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Millennium Management allocated the biggest weight to Unum Therapeutics Inc. (NASDAQ:UMRX), around 0.0001% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, earmarking 0.0001 percent of its 13F equity portfolio to UMRX.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Sectoral Asset Management. One hedge fund selling its entire position doesn't always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don't think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Citadel Investment Group).
Let's check out hedge fund activity in other stocks similar to Unum Therapeutics Inc. (NASDAQ:UMRX). These stocks are Westell Technologies Inc. (NASDAQ:WSTL), Sky Solar Holdings, Ltd. (NASDAQ:SKYS), Check-Cap Ltd. (NASDAQ:CHEK), and Document Security Systems, Inc. (NYSE:DSS). This group of stocks' market caps are similar to UMRX's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position WSTL,2,715,1 SKYS,1,162,0 CHEK,4,497,0 DSS,1,118,0 Average,2,373,0.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 2 hedge funds with bullish positions and the average amount invested in these stocks was $0 million. That figure was $0 million in UMRX's case. Check-Cap Ltd. (NASDAQ:CHEK) is the most popular stock in this table. On the other hand Sky Solar Holdings, Ltd. (NASDAQ:SKYS) is the least popular one with only 1 bullish hedge fund positions. Unum Therapeutics Inc. (NASDAQ:UMRX) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 7.9% in 2020 through May 22nd but still beat the market by 15.6 percentage points. Hedge funds were also right about betting on UMRX as the stock returned 27.1% in Q2 (through May 22nd) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.