The government requires hedge funds and wealthy investors with over a certain portfolio size to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings level the playing field for ordinary investors. The latest round of 13F filings discloses the funds’ positions on September 30. We at Insider Monkey have made an extensive database of more than 700 of those elite funds and prominent investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Zix Corporation (NASDAQ:ZIXI) based on those filings.
Zix Corporation (NASDAQ:ZIXI) investors should be aware of a decrease in hedge fund sentiment of late. ZIXI was in 16 hedge funds’ portfolios at the end of September. There were 17 hedge funds in our database with ZIXI holdings at the end of the previous quarter. At the end of this article we will also compare ZIXI to other stocks including Anthera Pharmaceuticals Inc (NASDAQ:ANTH), World Acceptance Corp. (NASDAQ:WRLD), and Viate Pharmaceuticals Inc (NASDAQ:VTAE) to get a better sense of its popularity.
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In the 21st century investor’s toolkit there are several gauges stock market investors employ to size up publicly traded companies. A duo of the most under-the-radar gauges are hedge fund and insider trading interest. Our researchers have shown that, historically, those who follow the top picks of the top investment managers can outperform the market by a solid margin (see the details here).
Keeping this in mind, we’re going to take a look at the key action surrounding Zix Corporation (NASDAQ:ZIXI).
What does the smart money think about Zix Corporation (NASDAQ:ZIXI)?
At the Q3’s end, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -6% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Renaissance Technologies holds the number one position in Zix Corporation (NASDAQ:ZIXI). Renaissance Technologies has a $7.8 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Engaged Capital, led by Glenn W. Welling, holding a $3.4 million position; 1.9% of its 13F portfolio is allocated to the stock. Remaining peers that hold long positions include D. E. Shaw’s D E Shaw, Robert B. Gillam’s McKinley Capital Management and Chuck Royce’s Royce & Associates.
Due to the fact that Zix Corporation (NASDAQ:ZIXI) has experienced bearish sentiment from the entirety of the hedge funds we track, it’s easy to see that there was a specific group of fund managers that slashed their positions entirely by the end of the third quarter. Interestingly, Dmitry Balyasny’s Balyasny Asset Management said goodbye to the biggest stake of the “upper crust” of funds followed by Insider Monkey, worth about $0.2 million in stock. Mike Vranos’s fund, Ellington, also dropped its stock, about $0.1 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 1 funds by the end of the third quarter.
Let’s now review hedge fund activity in other stocks similar to Zix Corporation (NASDAQ:ZIXI). These stocks are Anthera Pharmaceuticals Inc (NASDAQ:ANTH), World Acceptance Corp. (NASDAQ:WRLD), Viate Pharmaceuticals Inc (NASDAQ:VTAE), and Aquinox Pharmaceuticals Inc (NASDAQ:AQXP). This group of stocks’ market valuations are closest to ZIXI’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ANTH | 14 | 33309 | 3 |
| WRLD | 17 | 47604 | -1 |
| VTAE | 15 | 74982 | 6 |
| AQXP | 13 | 151616 | 4 |
As you can see these stocks had an average of 15 hedge funds with bullish positions and the average amount invested in these stocks was $77 million. That figure was $24 million in ZIXI’s case. World Acceptance Corp. (NASDAQ:WRLD) is the most popular stock in this table, while Aquinox Pharmaceuticals Inc (NASDAQ:AQXP) is the least popular one with only 13 bullish hedge fund positions. Zix Corporation (NASDAQ:ZIXI) is not the most popular stock in this group, but hedge fund interest is still above average. This is a slightly positive signal, but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard WRLD might be a better candidate to consider a long position.
