We are still in an overall bull market and many stocks that smart money investors were piling into surged through October 17th. Among them, Facebook and Microsoft ranked among the top 3 picks and these stocks gained 45% and 39% respectively. Hedge funds’ top 3 stock picks returned 34.4% this year and beat the S&P 500 ETFs by 13 percentage points. Investing in index funds guarantees you average returns, not superior returns. We are looking to generate superior returns for our readers. That’s why we believe it isn’t a waste of time to check out hedge fund sentiment before you invest in a stock like Jones Lang LaSalle Inc (NYSE:JLL).
Jones Lang LaSalle Inc (NYSE:JLL) shares haven’t seen a lot of action during the second quarter. Overall, hedge fund sentiment was unchanged. The stock was in 23 hedge funds’ portfolios at the end of June. At the end of this article we will also compare JLL to other stocks including Dr. Reddy’s Laboratories Limited (NYSE:RDY), Gentex Corporation (NASDAQ:GNTX), and Phillips 66 Partners LP (NYSE:PSXP) to get a better sense of its popularity. Our calculations also showed that JLL 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.
To most investors, hedge funds are perceived as unimportant, outdated financial vehicles of the past. While there are greater than 8000 funds trading at the moment, Our experts choose to focus on the moguls of this group, around 750 funds. Most estimates calculate that this group of people oversee most of the hedge fund industry’s total asset base, and by keeping an eye on their highest performing investments, Insider Monkey has identified several investment strategies that have historically surpassed the S&P 500 index. Insider Monkey’s flagship hedge fund strategy outperformed the S&P 500 index by around 5 percentage points a year since its inception in May 2014. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 25.7% since February 2017 (through September 30th) even though the market was up more than 33% during the same period. We just shared a list of 10 short targets in our latest quarterly update .
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, 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. Let’s review the new hedge fund action surrounding Jones Lang LaSalle Inc (NYSE:JLL).
Hedge fund activity in Jones Lang LaSalle Inc (NYSE:JLL)
At Q2’s end, a total of 23 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from one quarter earlier. By comparison, 18 hedge funds held shares or bullish call options in JLL a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Generation Investment Management was the largest shareholder of Jones Lang LaSalle Inc (NYSE:JLL), with a stake worth $599.1 million reported as of the end of March. Trailing Generation Investment Management was Ariel Investments, which amassed a stake valued at $113.5 million. Long Pond Capital, Junto Capital Management, and Diamond Hill Capital were also very fond of the stock, giving the stock large weights in their portfolios.
Because Jones Lang LaSalle Inc (NYSE:JLL) has experienced falling interest from the aggregate hedge fund industry, we can see that there lies a certain “tier” of hedgies who sold off their positions entirely in the second quarter. It’s worth mentioning that Ken Heebner’s Capital Growth Management said goodbye to the biggest investment of the 750 funds tracked by Insider Monkey, worth about $37 million in stock. Paul Marshall and Ian Wace’s fund, Marshall Wace LLP, also said goodbye to its stock, about $12.6 million worth. These moves are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Jones Lang LaSalle Inc (NYSE:JLL) but similarly valued. These stocks are Dr. Reddy’s Laboratories Limited (NYSE:RDY), Gentex Corporation (NASDAQ:GNTX), Phillips 66 Partners LP (NYSE:PSXP), and Morningstar, Inc. (NASDAQ:MORN). All of these stocks’ market caps resemble JLL’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| RDY | 11 | 80625 | 0 |
| GNTX | 23 | 388264 | 0 |
| PSXP | 3 | 9904 | -1 |
| MORN | 20 | 265985 | -1 |
| Average | 14.25 | 186195 | -0.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 14.25 hedge funds with bullish positions and the average amount invested in these stocks was $186 million. That figure was $985 million in JLL’s case. Gentex Corporation (NASDAQ:GNTX) is the most popular stock in this table. On the other hand Phillips 66 Partners LP (NYSE:PSXP) is the least popular one with only 3 bullish hedge fund positions. Jones Lang LaSalle Inc (NYSE:JLL) 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. 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 JLL wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on JLL were disappointed as the stock returned -1.1% 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 this year.
Disclosure: None. This article was originally published at Insider Monkey.
