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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. We at Insider Monkey have plowed through 817 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of September 30th, about a month before the elections. In this article we look at what those investors think of Global Indemnity Group LLC (NASDAQ:GBLI).
Global Indemnity Group LLC (NASDAQ:GBLI) was in 7 hedge funds' portfolios at the end of September. The all time high for this statistics is 7. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. GBLI has experienced an increase in support from the world's most elite money managers recently. There were 4 hedge funds in our database with GBLI holdings at the end of June. Our calculations also showed that GBLI isn't among the 30 most popular stocks among hedge funds (click for Q3 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.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's monthly stock picks returned 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Jeffrey Bronchick of Cove Street Capital
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. With all of this in mind let's check out the key hedge fund action encompassing Global Indemnity Group LLC (NASDAQ:GBLI).
What have hedge funds been doing with Global Indemnity Group LLC (NASDAQ:GBLI)?
Heading into the fourth quarter of 2020, a total of 7 of the hedge funds tracked by Insider Monkey were long this stock, a change of 75% from the second quarter of 2020. By comparison, 7 hedge funds held shares or bullish call options in GBLI a year ago. With hedge funds' sentiment swirling, there exists an "upper tier" of notable hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).
More specifically, Harbert Management was the largest shareholder of Global Indemnity Group LLC (NASDAQ:GBLI), with a stake worth $5.2 million reported as of the end of September. Trailing Harbert Management was Cove Street Capital, which amassed a stake valued at $3.1 million. Renaissance Technologies, LMR Partners, and Millennium Management were 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 Harbert Management allocated the biggest weight to Global Indemnity Group LLC (NASDAQ:GBLI), around 6.36% of its 13F portfolio. Cove Street Capital is also relatively very bullish on the stock, dishing out 0.58 percent of its 13F equity portfolio to GBLI.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls' herd. Harbert Management, managed by Raymond J. Harbert, assembled the largest position in Global Indemnity Group LLC (NASDAQ:GBLI). Harbert Management had $5.2 million invested in the company at the end of the quarter. Jeffrey Bronchick's Cove Street Capital also initiated a $3.1 million position during the quarter. The other funds with brand new GBLI positions are Jim Simons (founder)'s Renaissance Technologies, Ben Levine, Andrew Manuel and Stefan Renold's LMR Partners, and Israel Englander's Millennium Management.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Global Indemnity Group LLC (NASDAQ:GBLI) but similarly valued. These stocks are Titan Machinery Inc. (NASDAQ:TITN), Pulse Biosciences, Inc (NASDAQ:PLSE), Flushing Financial Corporation (NASDAQ:FFIC), Motorcar Parts of America, Inc. (NASDAQ:MPAA), IMV Inc. (NASDAQ:IMV), Spark Energy, Inc. (NASDAQ:SPKE), and Tufin Software Technologies Ltd. (NYSE:TUFN). This group of stocks' market valuations are closest to GBLI's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TITN,14,17341,5 PLSE,2,449,0 FFIC,10,26432,-1 MPAA,8,53762,0 IMV,5,2308,4 SPKE,7,11538,0 TUFN,9,3630,4 Average,7.9,16494,1.7 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 7.9 hedge funds with bullish positions and the average amount invested in these stocks was $16 million. That figure was $12 million in GBLI's case. Titan Machinery Inc. (NASDAQ:TITN) is the most popular stock in this table. On the other hand Pulse Biosciences, Inc (NASDAQ:PLSE) is the least popular one with only 2 bullish hedge fund positions. Global Indemnity Group LLC (NASDAQ:GBLI) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for GBLI is 58.8. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 31.6% in 2020 through December 2nd and still beat the market by 16 percentage points. A small number of hedge funds were also right about betting on GBLI as the stock returned 31.3% since the end of the third quarter (through 12/2) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.