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.
Is Hatteras Financial Corp. (NYSE:HTS) worth your attention right now? Hedge funds are selling. The number of bullish hedge fund positions fell by 4 lately. At the end of this article we will also compare HTS to other stocks including WNS (Holdings) Limited (ADR) (NYSE:WNS), Alon USA Partners LP (NYSE:ALDW), and Meritage Homes Corp (NYSE:MTH) to get a better sense of its popularity.
Keeping this in mind, we’re going to take a look at the fresh action encompassing Hatteras Financial Corp. (NYSE:HTS).
What does the smart money think about Hatteras Financial Corp. (NYSE:HTS)?
Heading into Q4, a total of 11 of the hedge funds tracked by Insider Monkey were long this stock, a change of -27% from one quarter earlier. With hedgies’ sentiment swirling, there exists a few key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the number one position in Hatteras Financial Corp. (NYSE:HTS). Citadel Investment Group has a $23.8 million position in the stock, comprising less than 0.1% of its 13F portfolio. The second largest stake is held by Nathaniel August of Mangrove Partners, with a $22.7 million position; 5.2% of its 13F portfolio is allocated to the company. Some other members of the smart money that hold long positions contain Dmitry Balyasny’s Balyasny Asset Management, Jim Simons’s Renaissance Technologies and Matthew Hulsizer’s PEAK6 Capital Management.