At Insider Monkey, we pore over the filings of more than 700 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of September 30. In this article, we will use that wealth of knowledge to determine whether or not Allied World Assurance Co Holdings, AG. (NYSE:AWH) makes for a good investment right now.
Allied World Assurance Co Holdings, AG. (NYSE:AWH) investors should be aware of an increase in hedge fund interest lately. AWH was in 28 hedge funds’ portfolios at the end of the third quarter of 2015. There were 24 hedge funds in our database with AWH 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 Vectren Corporation (NYSE:VVC), Corrections Corp Of America (NYSE:CXW), and MarketAxess Holdings Inc. (NASDAQ:MKTX) to gather more data points.
Follow Allied World Assurance Co Holdings Ag (NYSE:AWH)
Follow Allied World Assurance Co Holdings Ag (NYSE:AWH)
Today there are a large number of formulas investors have at their disposal to grade stocks. A couple of the best formulas are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the top picks of the best money managers can outpace their index-focused peers by a superb margin (see the details here).
With all of this in mind, we’re going to review the new action surrounding Allied World Assurance Co Holdings, AG. (NYSE:AWH).
What does the smart money think about Allied World Assurance Co Holdings, AG. (NYSE:AWH)?
Heading into Q4, a total of 28 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 17% from the second quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the most valuable position in Allied World Assurance Co Holdings, AG. (NYSE:AWH). Citadel Investment Group has a $49.7 million position in the stock, comprising less than 0.1% of its 13F portfolio. Coming in second is AQR Capital Management, managed by Cliff Asness, which holds a $34.8 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining members of the smart money that hold long positions encompass Israel Englander’s Millennium Management, Jim Simons’s Renaissance Technologies and D. E. Shaw’s D E Shaw.
As one would reasonably expect, key money managers have jumped into Allied World Assurance Co Holdings, AG. (NYSE:AWH) headfirst. Renaissance Technologies, managed by Jim Simons, created the most outsized position in Allied World Assurance Co Holdings, AG. (NYSE:AWH). Renaissance Technologies had $21 million invested in the company at the end of the quarter. Brian Ashford-Russell and Tim Woolley’s Polar Capital also made a $9.5 million investment in the stock during the quarter. The other funds with new positions in the stock are Ken Gray and Steve Walsh’s Bryn Mawr Capital, George Hall’s Clinton Group, and Jacob Gottlieb’s Visium Asset Management.
Let’s now take a look at hedge fund activity in other stocks similar to Allied World Assurance Co Holdings, AG. (NYSE:AWH). These stocks are Vectren Corporation (NYSE:VVC), Corrections Corp Of America (NYSE:CXW), MarketAxess Holdings Inc. (NASDAQ:MKTX), and Spirit Airlines Incorporated (NASDAQ:SAVE). This group of stocks’ market values resemble AWH’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| VVC | 10 | 70086 | -3 |
| CXW | 15 | 113309 | 1 |
| MKTX | 15 | 99631 | 3 |
| SAVE | 39 | 468214 | 8 |
As you can see these stocks had an average of 19.75 hedge funds with bullish positions and the average amount invested in these stocks was $188 million. That figure was $259 million in AWH’s case. Spirit Airlines Incorporated (NASDAQ:SAVE) is the most popular stock in this table. On the other hand Vectren Corporation (NYSE:VVC) is the least popular one with only 10 bullish hedge fund positions. Allied World Assurance Co Holdings, AG. (NYSE:AWH) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard SAVE might be a better candidate to consider a long position.
