Reputable billionaire investors such as Nelson Peltz and David Tepper generate exorbitant profits for their wealthy accredited investors (a minimum of $1 million in investable assets would be required to invest in a hedge fund and most successful hedge funds won’t accept your savings unless you commit at least $5 million) by pinpointing winning small-cap stocks. There is little or no publicly-available information at all on some of these small companies, which makes it hard for an individual investor to pin down a winner within the small-cap space. However, hedge funds and other big asset managers can do the due diligence and analysis for you instead, thanks to their highly-skilled research teams and vast resources to conduct an appropriate evaluation process. Looking for potential winners within the small-cap galaxy of stocks? We believe following the smart money is a good starting point.
PICO Holdings Inc (NASDAQ:PICO) investors should be aware of an increase in enthusiasm from smart money of late. PICO was in 10 hedge funds’ portfolios at the end of the third quarter of 2016. There were 8 hedge funds in our database with PICO holdings at the end of the previous quarter. At the end of this article we will also compare PICO to other stocks including RigNet Inc (NASDAQ:RNET), JP Energy Partners LP (NYSE:JPEP), and Macatawa Bank Corporation (NASDAQ:MCBC) to get a better sense of its popularity.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
photofriday/Shutterstock.com.
Hedge fund activity in PICO Holdings Inc (NASDAQ:PICO)
Heading into the fourth quarter of 2016, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, up by 25% from the second quarter of 2016. On the other hand, there were a total of 10 hedge funds with a bullish position in PICO at the beginning of this year. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Chuck Royce of Royce & Associates holds the most valuable position in PICO Holdings Inc (NASDAQ:PICO). Royce & Associates has a $17 million position in the stock. Coming in second is Kelly Cardwell of Central Square Management holding a $13.4 million position; 23.7% of its 13F portfolio is allocated to the company. Remaining professional money managers that hold long positions contain Gregory Bylinsky and Jefferson Gramm’s Bandera Partners, Jim Simons’ Renaissance Technologies, one of the largest hedge funds in the world, and Matthew Hulsizer’s PEAK6 Capital Management. We should note that Central Square Management is among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
