As we already know from media reports and hedge fund investor letters, hedge funds delivered their best returns in a decade. Most investors who decided to stick with hedge funds after a rough 2018 recouped their losses by the end of the fourth quarter of 2019. A significant number of hedge funds continued their strong performance in 2020 and 2021 as well. We get to see hedge funds’ thoughts towards the market and individual stocks by aggregating their quarterly portfolio movements and reading their investor letters. In this article, we will particularly take a look at what hedge funds think about ASA Gold and Precious Metals Ltd (NYSE:ASA).
Is ASA Gold and Precious Metals Ltd (NYSE:ASA) a buy right now? Investors who are in the know were in a pessimistic mood. The number of long hedge fund positions were trimmed by 1 lately. ASA Gold and Precious Metals Ltd (NYSE:ASA) was in 6 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 7. Our calculations also showed that ASA isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 7 hedge funds in our database with ASA positions at the end of the fourth quarter.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Phillip Goldstein of Bulldog Investors
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund owns nearly 40% of this $24 biotech stock and is trying to buy the rest for around $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. 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 homepage. Keeping this in mind let’s take a gander at the key hedge fund action encompassing ASA Gold and Precious Metals Ltd (NYSE:ASA).
Do Hedge Funds Think ASA Is A Good Stock To Buy Now?
At the end of March, a total of 6 of the hedge funds tracked by Insider Monkey were long this stock, a change of -14% from one quarter earlier. By comparison, 5 hedge funds held shares or bullish call options in ASA a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
More specifically, Royce & Associates was the largest shareholder of ASA Gold and Precious Metals Ltd (NYSE:ASA), with a stake worth $7.4 million reported as of the end of March. Trailing Royce & Associates was Water Street Capital, which amassed a stake valued at $4 million. Citadel Investment Group, Bulldog Investors, and GRT Capital Partners 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 Water Street Capital allocated the biggest weight to ASA Gold and Precious Metals Ltd (NYSE:ASA), around 0.41% of its 13F portfolio. GRT Capital Partners is also relatively very bullish on the stock, dishing out 0.1 percent of its 13F equity portfolio to ASA.
Because ASA Gold and Precious Metals Ltd (NYSE:ASA) has experienced a decline in interest from the entirety of the hedge funds we track, logic holds that there were a few hedgies who were dropping their positions entirely last quarter. At the top of the heap, Ron Mass’s Almitas Capital sold off the biggest position of all the hedgies followed by Insider Monkey, valued at an estimated $1.2 million in stock. Israel Englander’s fund, Millennium Management, also dropped its stock, about $0.7 million worth. These moves are important to note, as total hedge fund interest fell by 1 funds last quarter.
Let’s check out hedge fund activity in other stocks similar to ASA Gold and Precious Metals Ltd (NYSE:ASA). We will take a look at Lava Therapeutics B.V. (NASDAQ:LVTX), Takung Art Co., Ltd. (NYSE:TKAT), Spirit of Texas Bancshares, Inc. (NASDAQ:STXB), Citizens & Northern Corporation (NASDAQ:CZNC), CapStar Financial Holdings, Inc. (NASDAQ:CSTR), Aurora Mobile Limited (NASDAQ:JG), and SQZ Biotechnologies Company (NYSE:SQZ). This group of stocks’ market caps resemble ASA’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LVTX | 12 | 62353 | 12 |
| TKAT | 1 | 335 | 0 |
| STXB | 9 | 23323 | 1 |
| CZNC | 3 | 3965 | -1 |
| CSTR | 12 | 21655 | 5 |
| JG | 6 | 2665 | 3 |
| SQZ | 9 | 41439 | 5 |
| Average | 7.4 | 22248 | 3.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 7.4 hedge funds with bullish positions and the average amount invested in these stocks was $22 million. That figure was $12 million in ASA’s case. Lava Therapeutics B.V. (NASDAQ:LVTX) is the most popular stock in this table. On the other hand Takung Art Co., Ltd. (NYSE:TKAT) is the least popular one with only 1 bullish hedge fund positions. ASA Gold and Precious Metals Ltd (NYSE:ASA) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ASA is 52.4. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 19.3% in 2021 through June 25th and beat the market by 4.8 percentage points. A small number of hedge funds were also right about betting on ASA, though not to the same extent, as the stock returned 9.3% since the end of Q1 (through June 25th) and outperformed the market.
Follow Asa Gold & Precious Metals Ltd (NYSE:ASA)
Follow Asa Gold & Precious Metals Ltd (NYSE:ASA)
Suggested Articles:
- How to Best Use Insider Monkey To Increase Your Returns
- 15 Youngest Tech Billionaires
- 15 Most Valuable Cloud Computing Companies
Disclosure: None. This article was originally published at Insider Monkey.
