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Infosys Ltd ADR (INFY): Are Hedge Funds Right About This Stock?

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Is Infosys Ltd ADR (NYSE:INFY) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It’s not surprising given that hedge funds have access to better information and more resources to find the latest market-moving information.

Is Infosys Ltd ADR (NYSE:INFY) the right pick for your portfolio? The best stock pickers are becoming less confident. The number of bullish hedge fund positions that are disclosed in regulatory 13F filings went down by 3 lately. INFYwas in 20 hedge funds’ portfolios at the end of the third quarter of 2016. There were 23 hedge funds in our database with INFY holdings at the end of the previous quarter. 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 Bank of Montreal (USA) (NYSE:BMO), FedEx Corporation (NYSE:FDX), and PNC Financial Services (NYSE:PNC) to gather more data points.

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At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

Wichy/Shutterstock.com

Wichy/Shutterstock.com

What have hedge funds been doing with Infosys Ltd ADR (NYSE:INFY)?

At the end of the third quarter, a total of 20 of the hedge funds tracked by Insider Monkey held long positions in this stock, a 13% decrease from one quarter earlier. On the other hand, there were a total of 21 hedge funds with a bullish position in INFY at the beginning of this year. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
infy
Of the funds tracked by Insider Monkey, Ken Fisher’s Fisher Asset Management has the biggest position in Infosys Ltd ADR (NYSE:INFY), worth close to $383.3 million. The second largest stake is held by AQR Capital Management, led by Cliff Asness, which holds a $242 million position. Remaining hedge funds and institutional investors that are bullish include Bernard Horn’s Polaris Capital Management, Jim Simons’ Renaissance Technologies, and Simon Sadler’s Segantii Capital. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

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