Investing in hedge funds can bring large profits, but it’s not for everybody, since hedge funds are available only for high-net-worth individuals. They generate significant returns for investors to justify their large fees and they allocate a lot of time and employ a complex analysis to determine the best stocks to invest in. A particularly interesting group of stocks that hedge funds like is the small-caps. The huge amount of capital does not allow hedge funds to invest a lot in small-caps, but our research showed that their most popular small-cap ideas are less efficiently priced and generate stronger returns than their large- and mega-cap picks and the broader market. That is why we follow the hedge fund activity in the small-cap space.
Hedge fund interest in Heritage Financial Corporation (NASDAQ:HFWA) shares’ was flat at the end of last quarter. This is usually a negative indicator. At the end of this article, we will also compare Heritage Financial Corporation (NASDAQ:HFWA) to other stocks, including Resources Connection, Inc. (NASDAQ:RECN), Forrester Research, Inc. (NASDAQ:FORR), and Vascular Solutions, Inc. (NASDAQ:VASC) to get a better sense of its popularity.
According to most investors, hedge funds are assumed to be slow, outdated investment tools of the past. While there are more than 8000 funds in operation at the moment, Our experts choose to focus on the top tier of this club, approximately 700 funds. It is estimated that this group of investors presides over the bulk of all hedge funds’ total capital, and by tracking their unrivaled equity investments, Insider Monkey has identified a few investment strategies that have historically surpassed Mr. Market. Insider Monkey’s small-cap hedge fund strategy outpaced the S&P 500 index by 12 percentage points per annum for a decade in their back tests.
With all of this in mind, let’s check out the key action regarding Heritage Financial Corporation (NASDAQ:HFWA).
How have hedgies been trading Heritage Financial Corporation (NASDAQ:HFWA)?
At the end of the previous quarter, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, flat over the last quarter. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Forest Hill Capital, managed by Mark Lee, holds the number one position in Heritage Financial Corporation (NASDAQ:HFWA). Forest Hill Capital has a $41.4 million position in the stock, comprising 3.9% of its 13F portfolio. Coming in second is Castine Capital Management, managed by Paul Magidson, Jonathan Cohen and Ostrom Enders, which holds a $4.5 million position; 2% of its 13F portfolio is allocated to the stock. Some other hedge funds and institutional investors that are bullish encompass Paul Hondros’ AlphaOne Capital Partners, Renaissance Technologies, and Millennium Management Subsidiary’s Green Arrow Capital Management.