At Insider Monkey, we pore over the filings of nearly 750 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of June 28. In this article, we will use that wealth of knowledge to determine whether or not Ideanomics, Inc. (NASDAQ:IDEX) makes for a good investment right now.
Is Ideanomics, Inc. (NASDAQ:IDEX) a bargain? The smart money is becoming more confident. The number of long hedge fund positions improved by 3 recently. Our calculations also showed that IDEX isn’t among the 30 most popular stocks among hedge funds (see the video below). IDEX was in 4 hedge funds’ portfolios at the end of June. There were 1 hedge funds in our database with IDEX positions at the end of the previous quarter.
Video: Click the image to 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 flagship best performing hedge funds strategy returned 25.8% year to date (through May 30th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 40 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
n addition to following the biggest hedge funds for investment ideas, we also share stock pitches from conferences, investor letters and other sources like this one where the fund manager is talking about two under the radar 1000% return potential stocks: first one in internet infrastructure and the second in the heart of advertising market. We use hedge fund buy/sell signals to determine whether to conduct in-depth analysis of these stock ideas which take days. Let’s view the fresh hedge fund action surrounding Ideanomics, Inc. (NASDAQ:IDEX).
What does smart money think about Ideanomics, Inc. (NASDAQ:IDEX)?
At the end of the second quarter, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 300% from the previous quarter. On the other hand, there were a total of 0 hedge funds with a bullish position in IDEX a year ago. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Israel Englander’s Millennium Management has the number one position in Ideanomics, Inc. (NASDAQ:IDEX), worth close to $0.1 million, accounting for less than 0.1%% of its total 13F portfolio. Sitting at the No. 2 spot is Renaissance Technologies holding a $0.1 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other members of the smart money that are bullish contain Ken Griffin’s Citadel Investment Group, and Karim Abbadi and Edward McBride’s Centiva Capital.
As aggregate interest increased, key money managers were leading the bulls’ herd. Renaissance Technologies established the biggest position in Ideanomics, Inc. (NASDAQ:IDEX). Renaissance Technologies had $0.1 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also made a $0 million investment in the stock during the quarter. The only other fund with a brand new IDEX position is Karim Abbadi and Edward McBride’s Centiva Capital.
Let’s go over hedge fund activity in other stocks similar to Ideanomics, Inc. (NASDAQ:IDEX). These stocks are Oil-Dri Corporation of America (NYSE:ODC), FVCBankcorp, Inc. (NASDAQ:FVCB), Hallmark Financial Services, Inc. (NASDAQ:HALL), and Atlantic Power Corp (NYSE:AT). This group of stocks’ market values are similar to IDEX’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ODC | 3 | 32544 | 0 |
| FVCB | 2 | 7616 | -1 |
| HALL | 10 | 33541 | 4 |
| AT | 12 | 30039 | 0 |
| Average | 6.75 | 25935 | 0.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 6.75 hedge funds with bullish positions and the average amount invested in these stocks was $26 million. That figure was $0 million in IDEX’s case. Atlantic Power Corp (NYSE:AT) is the most popular stock in this table. On the other hand FVCBankcorp, Inc. (NASDAQ:FVCB) is the least popular one with only 2 bullish hedge fund positions. Ideanomics, Inc. (NASDAQ:IDEX) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately IDEX wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); IDEX investors were disappointed as the stock returned -38.6% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far in 2019.
Disclosure: None. This article was originally published at Insider Monkey.