The financial regulations require hedge funds and wealthy investors that exceeded the $100 million holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on June 30th. We at Insider Monkey have made an extensive database of more than 873 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded LPL Financial Holdings Inc (NASDAQ:LPLA) based on those filings.
LPL Financial Holdings Inc (NASDAQ:LPLA) investors should be aware of an increase in hedge fund interest recently. LPL Financial Holdings Inc (NASDAQ:LPLA) was in 48 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 43. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that LPLA isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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Robert Pohly of Samlyn Capital
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Do Hedge Funds Think LPLA Is A Good Stock To Buy Now?
At second quarter’s end, a total of 48 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 26% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards LPLA over the last 24 quarters. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
The largest stake in LPL Financial Holdings Inc (NASDAQ:LPLA) was held by Samlyn Capital, which reported holding $343.7 million worth of stock at the end of June. It was followed by Southpoint Capital Advisors with a $202.5 million position. Other investors bullish on the company included HG Vora Capital Management, First Pacific Advisors LLC, and Millennium Management. In terms of the portfolio weights assigned to each position Engle Capital allocated the biggest weight to LPL Financial Holdings Inc (NASDAQ:LPLA), around 10.22% of its 13F portfolio. HG Vora Capital Management is also relatively very bullish on the stock, setting aside 6.09 percent of its 13F equity portfolio to LPLA.
Consequently, some big names have been driving this bullishness. Balyasny Asset Management, managed by Dmitry Balyasny, assembled the largest position in LPL Financial Holdings Inc (NASDAQ:LPLA). Balyasny Asset Management had $52.1 million invested in the company at the end of the quarter. Ryan Caldwell’s Chiron Investment Management also initiated a $30.3 million position during the quarter. The other funds with new positions in the stock are Ira Unschuld’s Brant Point Investment Management, Renaissance Technologies, and Gregg Moskowitz’s Interval Partners.
Let’s now take a look at hedge fund activity in other stocks similar to LPL Financial Holdings Inc (NASDAQ:LPLA). We will take a look at Gaming and Leisure Properties Inc (NASDAQ:GLPI), Jazz Pharmaceuticals Plc (NASDAQ:JAZZ), Cleveland-Cliffs Inc (NYSE:CLF), Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI), Marathon Oil Corporation (NYSE:MRO), PRA Health Sciences Inc (NASDAQ:PRAH), and The Scotts Miracle-Gro Company (NYSE:SMG). This group of stocks’ market valuations are similar to LPLA’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GLPI | 27 | 515879 | -1 |
| JAZZ | 34 | 1493732 | -3 |
| CLF | 44 | 1111037 | 8 |
| MRVI | 20 | 572985 | -6 |
| MRO | 34 | 655729 | 5 |
| PRAH | 43 | 2995527 | 8 |
| SMG | 32 | 369779 | -2 |
| Average | 33.4 | 1102095 | 1.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 33.4 hedge funds with bullish positions and the average amount invested in these stocks was $1102 million. That figure was $1501 million in LPLA’s case. Cleveland-Cliffs Inc (NYSE:CLF) is the most popular stock in this table. On the other hand Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI) is the least popular one with only 20 bullish hedge fund positions. Compared to these stocks LPL Financial Holdings Inc (NASDAQ:LPLA) is more popular among hedge funds. Our overall hedge fund sentiment score for LPLA is 90. 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 returned 22.9% in 2021 through October 1st but still managed to beat the market by 5.6 percentage points. Hedge funds were also right about betting on LPLA as the stock returned 18.9% since the end of June (through 10/1) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
