Many investors, including Carl Icahn or Stan Druckenmiller, have been saying for a while now that the current market is overvalued due to a low interest rate environment that leads to companies swapping their equity for debt and focusing mostly on short-term performance such as beating the quarterly earnings estimates. In the third quarter, many investors lost money due to unpredictable events such as the concerns over Valeant’s drug pricing policy that led to an overall drop among pharma stocks. Nevertheless, many of the stocks that tanked in the third quarter still sport strong fundamentals and their decline was more related to the general market sentiment rather than their individual performance and hedge funds kept their bullish stance. In this article we will find out how hedge fund sentiment to Markit Ltd (NASDAQ:MRKT) changed recently.
Markit Ltd (NASDAQ:MRKT) investors should be aware of a decrease in support from the world’s most elite money managers recently. At the end of this article we will also compare MRKT to other stocks, including iShares MSCI ACWI Index Fund (NASDAQ:ACWI), Regency Centers Corp (NYSE:REG), and Columbia Pipeline Group Inc (NYSE:CPGX) to get a better sense of its popularity.
According to most investors, hedge funds are assumed to be unimportant, outdated financial tools of the past. While there are over 8000 funds trading at the moment, Our researchers choose to focus on the aristocrats of this club, about 700 funds. These investment experts preside over the majority of all hedge funds’ total asset base, and by observing their highest performing picks, Insider Monkey has figured out various investment strategies that have historically beaten the S&P 500 index. 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.
Keeping this in mind, we’re going to review the new action surrounding Markit Ltd (NASDAQ:MRKT).
How have hedgies been trading Markit Ltd (NASDAQ:MRKT)?
Heading into Q4, a total of 16 of the hedge funds tracked by Insider Monkey were long this stock, a drop of 24% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Platinum Asset Management, managed by Kerr Neilson, holds the number one position in Markit Ltd (NASDAQ:MRKT). The fund reportedly holds a $67.3 million stake in the company, comprising 1.8% of its 13F portfolio. Coming in second is Tudor Investment Corp, led by Paul Tudor Jones, holding a $29.7 million position; the fund has 1% of its 13F portfolio invested in the stock. Remaining members of the smart money that hold long positions comprise Sahm Adrangi’s Kerrisdale Capital, Matthew Iorio’s White Elm Capital and D. E. Shaw’s D E Shaw.