The financial regulations require hedge funds and wealthy investors that crossed the $100 million equity 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 28th. We at Insider Monkey have made an extensive database of nearly 750 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Match Group, Inc. (NASDAQ:MTCH) based on those filings.
Match Group, Inc. (NASDAQ:MTCH) has seen an increase in activity from the world’s largest hedge funds in recent months. Our calculations also showed that MTCH isn’t among the 30 most popular stocks among hedge funds (see the video below).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 25.7% through September 30, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Unlike some fund managers who are betting on Dow reaching 40000 in a year, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. We’re going to take a gander at the latest hedge fund action encompassing Match Group, Inc. (NASDAQ:MTCH).
How are hedge funds trading Match Group, Inc. (NASDAQ:MTCH)?
At Q2’s end, a total of 31 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 29% from one quarter earlier. On the other hand, there were a total of 26 hedge funds with a bullish position in MTCH a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Match Group, Inc. (NASDAQ:MTCH), which was worth $189.8 million at the end of the second quarter. On the second spot was D E Shaw which amassed $140.8 million worth of shares. Moreover, AQR Capital Management, Two Sigma Advisors, and Light Street Capital were also bullish on Match Group, Inc. (NASDAQ:MTCH), allocating a large percentage of their portfolios to this stock.
As one would reasonably expect, some big names were leading the bulls’ herd. Scopus Asset Management, managed by Alexander Mitchell, assembled the largest position in Match Group, Inc. (NASDAQ:MTCH). Scopus Asset Management had $44.1 million invested in the company at the end of the quarter. Edmond M. Safra’s EMS Capital also made a $32.7 million investment in the stock during the quarter. The other funds with brand new MTCH positions are Louis Bacon’s Moore Global Investments, James Crichton’s Hitchwood Capital Management, and Nick Niell’s Arrowgrass Capital Partners.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Match Group, Inc. (NASDAQ:MTCH) but similarly valued. We will take a look at Ameriprise Financial, Inc. (NYSE:AMP), ORIX Corporation (NYSE:IX), KLA Corporation (NASDAQ:KLAC), and Splunk Inc (NASDAQ:SPLK). All of these stocks’ market caps match MTCH’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| AMP | 39 | 961087 | 5 |
| IX | 6 | 12820 | 0 |
| KLAC | 24 | 504403 | -17 |
| SPLK | 25 | 206778 | -4 |
| Average | 23.5 | 421272 | -4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 23.5 hedge funds with bullish positions and the average amount invested in these stocks was $421 million. That figure was $788 million in MTCH’s case. Ameriprise Financial, Inc. (NYSE:AMP) is the most popular stock in this table. On the other hand ORIX Corporation (NYSE:IX) is the least popular one with only 6 bullish hedge fund positions. Match Group, Inc. (NASDAQ:MTCH) is not the most popular stock in this group but hedge fund interest is still above average. 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. Hedge funds were also right about betting on MTCH as the stock returned 6.2% during the third quarter and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.
