The financial regulations require hedge funds and wealthy investors that exceeded the $100 million 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 September 30th. We at Insider Monkey have made an extensive database of more than 867 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Tradeweb Markets Inc. (NASDAQ:TW) based on those filings.
Is Tradeweb Markets Inc. (NASDAQ:TW) ready to rally soon? Prominent investors were in a bullish mood. The number of bullish hedge fund bets went up by 7 recently. Tradeweb Markets Inc. (NASDAQ:TW) was in 22 hedge funds’ portfolios at the end of September. The all time high for this statistic is 38. Our calculations also showed that TW isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. Keeping this in mind we’re going to take a glance at the recent hedge fund action encompassing Tradeweb Markets Inc. (NASDAQ:TW).
Alex Litowitz of Magnetar Capital
Do Hedge Funds Think TW Is A Good Stock To Buy Now?
At Q3’s end, a total of 22 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 47% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards TW over the last 25 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Junto Capital Management was the largest shareholder of Tradeweb Markets Inc. (NASDAQ:TW), with a stake worth $59.7 million reported as of the end of September. Trailing Junto Capital Management was D E Shaw, which amassed a stake valued at $28.6 million. GLG Partners, Balyasny Asset Management, and Tudor Investment Corp were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Junto Capital Management allocated the biggest weight to Tradeweb Markets Inc. (NASDAQ:TW), around 1.88% of its 13F portfolio. Diametric Capital is also relatively very bullish on the stock, designating 1 percent of its 13F equity portfolio to TW.
As aggregate interest increased, key hedge funds have jumped into Tradeweb Markets Inc. (NASDAQ:TW) headfirst. Balyasny Asset Management, managed by Dmitry Balyasny, created the most outsized position in Tradeweb Markets Inc. (NASDAQ:TW). Balyasny Asset Management had $8 million invested in the company at the end of the quarter. Paul Tudor Jones’s Tudor Investment Corp also made a $4.5 million investment in the stock during the quarter. The other funds with new positions in the stock are Jinghua Yan’s TwinBeech Capital, Alec Litowitz and Ross Laser’s Magnetar Capital, and Greg Eisner’s Engineers Gate Manager.
Let’s check out hedge fund activity in other stocks similar to Tradeweb Markets Inc. (NASDAQ:TW). We will take a look at Tyler Technologies, Inc. (NYSE:TYL), Hologic, Inc. (NASDAQ:HOLX), Ubiquiti Inc. (NYSE:UI), Seagate Technology Holdings plc (NASDAQ:STX), Hewlett Packard Enterprise Company (NYSE:HPE), Qorvo Inc (NASDAQ:QRVO), and Cincinnati Financial Corporation (NASDAQ:CINF). This group of stocks’ market values are similar to TW’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| TYL | 30 | 772769 | -3 |
| HOLX | 39 | 716983 | -2 |
| UI | 20 | 240246 | -3 |
| STX | 27 | 1806109 | -4 |
| HPE | 33 | 1002469 | -1 |
| QRVO | 44 | 1950993 | 4 |
| CINF | 20 | 661958 | -2 |
| Average | 30.4 | 1021647 | -1.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 30.4 hedge funds with bullish positions and the average amount invested in these stocks was $1022 million. That figure was $135 million in TW’s case. Qorvo Inc (NASDAQ:QRVO) is the most popular stock in this table. On the other hand Ubiquiti Inc. (NYSE:UI) is the least popular one with only 20 bullish hedge fund positions. Tradeweb Markets Inc. (NASDAQ:TW) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for TW is 31.5. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 and still beat the market by 3.6 percentage points. A small number of hedge funds were also right about betting on TW as the stock returned 24.1% since the end of the third quarter (through 12/31) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
