Hedge funds and other investment firms run by legendary investors like Israel Englander and Ray Dalio are entrusted to manage billions of dollars of accredited investors’ money because they are without peer in the resources they use to identify the best investments for their chosen investment horizon. Moreover, they are more willing to invest a greater amount of their resources in small-cap stocks than big brokerage houses, and this is often where they generate their outperformance, which is why we pay particular attention to their best ideas in this space.
Asanko Gold Inc (NYSEMKT:AKG) shares didn’t see a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 8 hedge funds’ portfolios at the end of September. 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 Barnes & Noble, Inc. (NYSE:BKS), ARMOUR Residential REIT, Inc. (NYSE:ARR), and Dominion Diamond Corp (NYSE:DDC) to gather more data points.
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How are hedge funds trading Asanko Gold Inc (NYSEMKT:AKG)?
At Q3’s end, a total of 8 of the hedge funds tracked by Insider Monkey held long positions in this stock, unchanged from the previous quarter. On the other hand, there were a total of 8 hedge funds with a bullish position in AKG at the beginning of this year. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Of the funds tracked by Insider Monkey, Peter Franklin Palmedo’s Sun Valley Gold has the biggest position in Asanko Gold Inc (NYSEMKT:AKG), worth close to $44.7 million, corresponding to 1.4% of its total 13F portfolio. Coming in second is Eric Sprott of Sprott Asset Management, with a $35.3 million position; 1.2% of its 13F portfolio is allocated to the company. Other hedge funds and institutional investors that hold long positions include Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, D. E. Shaw’s D E Shaw, which is one of the biggest hedge funds in the world, and Jim Simons’ Renaissance Technologies. We should note that two of these hedge funds (Sun Valley Gold and Sprott Asset Management) 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.
Seeing as Asanko Gold Inc (NYSEMKT:AKG) has witnessed declining sentiment from the smart money, it’s safe to say that there were a few hedgies that slashed their full holdings last quarter. Intriguingly, Ken Griffin’s Citadel Investment Group dumped the largest investment of the 700 funds monitored by Insider Monkey, totaling close to $0.1 million in call options, and Glenn Russell Dubin’s Highbridge Capital Management was right behind this move, as the fund dumped about $0.1 million worth of shares.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Asanko Gold Inc (NYSEMKT:AKG) but similarly valued. We will take a look at Barnes & Noble, Inc. (NYSE:BKS), ARMOUR Residential REIT, Inc. (NYSE:ARR), Dominion Diamond Corp (NYSE:DDC), and Babcock & Wilcox Enterprises Inc (NYSE:BW). This group of stocks’ market values resemble AKG’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BKS | 15 | 153873 | -6 |
| ARR | 6 | 22230 | 2 |
| DDC | 14 | 73277 | 0 |
| BW | 20 | 198761 | 0 |
As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $112 million. That figure was $88 million in AKG’s case. Babcock & Wilcox Enterprises Inc (NYSE:BW) is the most popular stock in this table. On the other hand ARMOUR Residential REIT, Inc. (NYSE:ARR) is the least popular one with only 6 bullish hedge fund positions. Asanko Gold Inc (NYSEMKT:AKG) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard BW might be a better candidate to consider taking a long position in.
Disclosure: None
