Between June 25 and October 30th the Russell 2000 ETF (IWM) lagged the larger S&P 500 ETF (SPY) by more than 14 percentage points as investors worried over the possible ramifications of rising interest rates. The hedge funds and institutional investors we track typically invest more in smaller-cap stocks than an average investor, and we have seen data that shows those funds paring back their overall exposure. Those funds cutting positions in small-caps is one reason why volatility has increased. In the following paragraphs, we take a closer look at what hedge funds and prominent investors think of Owens Realty Mortgage Inc (NYSEMKT:ORM) and see how the stock is affected by the recent hedge fund activity.
Owens Realty Mortgage Inc (NYSEMKT:ORM) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 4 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 Rightside Group Ltd (NASDAQ:NAME), Dipexium Pharmaceuticals Inc (NASDAQ:DPRX), and Electro Scientific Industries, Inc. (NASDAQ:ESIO) to gather more data points.
According to most investors, hedge funds are seen as unimportant, outdated financial vehicles of yesteryear. While there are over 8000 funds with their doors open today, Our researchers hone in on the aristocrats of this group, around 700 funds. These investment experts orchestrate the majority of the hedge fund industry’s total capital, and by following their matchless investments, Insider Monkey has formulated a few investment strategies that have historically outpaced the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy surpassed the S&P 500 index by 12 percentage points per year for a decade in their back tests.
Keeping this in mind, we’re going to take a gander at the fresh action encompassing Owens Realty Mortgage Inc (NYSEMKT:ORM).
How are hedge funds trading Owens Realty Mortgage Inc (NYSEMKT:ORM)?
When looking at the institutional investors followed by Insider Monkey, Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management has the most valuable position in Owens Realty Mortgage Inc (NYSEMKT:ORM), worth close to $13.5 million, corresponding to 1.8% of its total 13F portfolio. On Nantahala Capital Management’s heels is Jim Simons of Renaissance Technologies, with a $1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other professional money managers that are bullish contain Ari Zweiman’s 683 Capital Partners, and Israel Englander’s Millennium Management.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.
Let’s check out hedge fund activity in other stocks similar to Owens Realty Mortgage Inc (NYSEMKT:ORM) on the next page.