Hedge funds and other investment firms that we track manage billions of dollars of their wealthy clients’ money, and needless to say, they are painstakingly thorough when analyzing where to invest this money, as their own wealth depends on it. Regardless of the various methods used by elite investors like David Tepper and Dan Loeb, the resources they expend are second-to-none. This is especially valuable when it comes to small-cap stocks, which is where they generate their strongest outperformance, as their resources give them a huge edge when it comes to studying these stocks compared to the average investor, which is why we intently follow their activity in the small-cap space.
Citizens Financial Group Inc (NYSE:CFG) has experienced an increase in hedge fund sentiment in recent months. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as CenturyLink, Inc. (NYSE:CTL), ServiceNow Inc (NYSE:NOW), and Autodesk, Inc. (NASDAQ:ADSK) to gather more data points.
In the financial world, there are many gauges stock market investors have at their disposal to evaluate their stock investments. A pair of the most useful gauges are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the best picks of the top money managers can outclass the market by a solid margin (see the details here).
David Eihorn’s Greenlight Capital was one of the shareholders of Citizens Financial Group, but sold the stake last year. In a letter to investors from 2014, Greenlight said: