We at Insider Monkey have gone over 738 13F filings that hedge funds and famous value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article we look at what those investors think of The Toronto-Dominion Bank (NYSE:TD).
The Toronto-Dominion Bank (NYSE:TD) investors should pay attention to an increase in activity from the world’s largest hedge funds of late. Our calculations also showed that td isn’t among the 30 most popular stocks among hedge funds.
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.
Cliff Asness of AQR Capital Management
Let’s go over the recent hedge fund action surrounding The Toronto-Dominion Bank (NYSE:TD).
What have hedge funds been doing with The Toronto-Dominion Bank (NYSE:TD)?
At the end of the first quarter, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from the previous quarter. On the other hand, there were a total of 19 hedge funds with a bullish position in TD a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
The largest stake in The Toronto-Dominion Bank (NYSE:TD) was held by Renaissance Technologies, which reported holding $281.2 million worth of stock at the end of March. It was followed by Citadel Investment Group with a $211.1 million position. Other investors bullish on the company included AQR Capital Management, D E Shaw, and Bridgewater Associates.
As aggregate interest increased, key hedge funds were leading the bulls’ herd. BlueCrest Capital Mgmt., managed by Michael Platt and William Reeves, assembled the largest position in The Toronto-Dominion Bank (NYSE:TD). BlueCrest Capital Mgmt. had $1.8 million invested in the company at the end of the quarter. Brad Dunkley and Blair Levinsky’s Waratah Capital Advisors also made a $1.6 million investment in the stock during the quarter. The other funds with new positions in the stock are George Zweig, Shane Haas and Ravi Chander’s Signition LP, Roy Vermus and Shlomi Bracha’s Noked Capital, and Thomas E. Claugus’s GMT Capital.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as The Toronto-Dominion Bank (NYSE:TD) but similarly valued. These stocks are Texas Instruments Incorporated (NASDAQ:TXN), Diageo plc (NYSE:DEO), China Petroleum & Chemical Corp (NYSE:SNP), and United Parcel Service, Inc. (NYSE:UPS). This group of stocks’ market valuations match TD’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TXN | 43 | 2309168 | -1 |
| DEO | 16 | 861675 | 2 |
| SNP | 13 | 250613 | -2 |
| UPS | 37 | 1006858 | 5 |
| Average | 27.25 | 1107079 | 1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 27.25 hedge funds with bullish positions and the average amount invested in these stocks was $1107 million. That figure was $818 million in TD’s case. Texas Instruments Incorporated (NASDAQ:TXN) is the most popular stock in this table. On the other hand China Petroleum & Chemical Corp (NYSE:SNP) is the least popular one with only 13 bullish hedge fund positions. The Toronto-Dominion Bank (NYSE:TD) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 20 most popular stocks among hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. A small number of hedge funds were also right about betting on TD as the stock returned 3.4% during the same time frame and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.
