Is SVB Financial Group (SIVB) Going to Burn These Hedge Funds?

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SVB Financial Group (NASDAQ:SIVB) has seen an increase in activity from the world’s largest hedge funds in recent months. SIVB was in 34 hedge funds’ portfolios at the end of September. There were 30 hedge funds in our database with SIVB positions at the end of the previous quarter. At the end of this article we will also compare SIVB to other stocks, including Macquarie Infrastructure Company LLC (NYSE:MIC), Domino’s Pizza, Inc. (NYSE:DPZ), and NiSource Inc. (NYSE:NI) to get a better sense of its popularity.

If you’d ask most market participants, hedge funds are seen as unimportant, outdated investment vehicles of years past. While there are more than 8000 funds in operation at the moment, Our experts choose to focus on the elite of this group, around 700 funds. Most estimates calculate that this group of people handle the majority of the hedge fund industry’s total capital, and by observing their first-class picks, Insider Monkey has unsheathed many investment strategies that have historically outrun the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points annually for a decade in their back tests.

With all of this in mind, we’re going to take a peek at the fresh action surrounding SVB Financial Group (NASDAQ:SIVB).

What have hedge funds been doing with SVB Financial Group (NASDAQ:SIVB)?

At the Q3’s end, a total of 34 of the hedge funds tracked by Insider Monkey were long this stock, a change of 13% from the previous quarter. With hedgies’ sentiment swirling, there exists a few key hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Fisher Asset Management, managed by Ken Fisher, holds the largest position in SVB Financial Group (NASDAQ:SIVB). Fisher Asset Management has a $163.4 million position in the stock, comprising 0.3% of its 13F portfolio. Coming in second is Ken Griffin’s Citadel Investment Group, with a $84.9 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other professional money managers that hold long positions include Israel Englander’s Millennium Management, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Robert Pohly’s Samlyn Capital.

Consequently, key hedge funds have jumped into SVB Financial Group (NASDAQ:SIVB) headfirst. Basswood Capital, managed by Matthew Lindenbaum, initiated the largest position in SVB Financial Group (NASDAQ:SIVB). Basswood Capital had $9.8 million invested in the company at the end of the quarter. Peter Muller’s PDT Partners also initiated a $5.2 million position during the quarter. The following funds were also among the new SIVB investors: Jim Simons’ Renaissance Technologies, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners.

Let’s check out hedge fund activity in other stocks similar to SVB Financial Group (NASDAQ:SIVB). We will take a look at Macquarie Infrastructure Company LLC (NYSE:MIC), Domino’s Pizza, Inc. (NYSE:DPZ), NiSource Inc. (NYSE:NI), and Atmos Energy Corporation (NYSE:ATO). All of these stocks’ market caps resemble SIVB’s market cap.

As you can see these stocks had an average of 33 hedge funds with bullish positions and the average amount invested in these stocks was $777 million. That figure was $454 million in SIVB’s case. Macquarie Infrastructure Company LLC (NYSE:MIC) is the most popular stock in this table. On the other hand Atmos Energy Corporation (NYSE:ATO) is the least popular one with only 11 bullish hedge fund positions. SVB Financial Group (NASDAQ:SIVB) 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. In this regard MIC might be a better candidate to consider a long position.