Before putting in our own effort and resources into finding a good investment, we can quickly utilize hedge fund expertise to give us a quick glimpse of whether that stock could make for a good addition to our portfolios. The odds are not exactly stacked in investors’ favor when it comes to beating the market, as evidenced by the fact that less than 49% of the stocks in the S&P 500 did so during the 12-month period ending October 30. However, 63% of hedge funds’ top 30 stock picks from the index did beat the market, and returned nearly twice as much on average as the index. Thus, we can see that the tireless research and efforts of hedge funds to identify winning stocks can work to our advantage when we know how to use the data. While not all of their picks will be winners, our odds are much better following their best stock picks than trying to go it alone.
Meridian Bancorp, Inc. (NASDAQ:EBSB) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 16 hedge funds’ portfolios at the end of the third quarter of 2015. 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 Lakeland Financial Corporation (NASDAQ:LKFN), Ethan Allen Interiors Inc. (NYSE:ETH), and Radware Ltd. (NASDAQ:RDWR) to gather more data points.
At the moment there are a lot of methods investors employ to analyze publicly traded companies. A duo of the most innovative methods are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the best picks of the elite fund managers can beat the market by a solid amount (see the details here).
With all of this in mind, we’re going to take a look at the latest action encompassing Meridian Bancorp, Inc. (NASDAQ:EBSB).
How have hedgies been trading Meridian Bancorp, Inc. (NASDAQ:EBSB)?
Heading into Q4, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, unchanged from one quarter earlier. With the smart money’s sentiment swirling, there exists a few notable hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Phill Gross and Robert Atchinson’s Adage Capital Management has the number one position in Meridian Interstate Bancorp, Inc. (NASDAQ:EBSB), worth close to $36.2 million, amounting to 0.1% of its total 13F portfolio. Coming in second is EJF Capital, led by Emanuel J. Friedman, holding a $30.1 million position; the fund has 1.5% of its 13F portfolio invested in the stock. Other professional money managers that hold long positions encompass Neil Chriss’ Hutchin Hill Capital, Jim Simons’ Renaissance Technologies, and Michael Kaine’s Numina Capital.