Should You Avoid The Western Union Company (NYSE:WU)? A market correction in the third quarter, spurred by a number of global macroeconomic concerns ended up having a negative impact on the markets and many hedge funds as a result. The stocks of smaller companies were especially hard hit during this time as investors fled to investments seen as being safer. This is evident in the fact that the Russell 2000 ETF underperformed the S&P 500 ETF by 14 percentage points between June 25 and the end of October. We also received indications that hedge funds were trimming their positions amid the market volatility and uncertainty, and given their greater inclination towards smaller cap stocks than other investors, it follows that a stronger sell-off occurred in those stocks. Let’s study the hedge fund sentiment to see how those concerns affected their ownership of The Western Union Company (NYSE:WU) during the quarter.
Is The Western Union Company (NYSE:WU) a safe investment right now? Prominent investors are in a bearish mood. The number of bullish hedge fund bets decreased by 7 in recent months. At the end of this article we will also compare WU to other stocks including Annaly Capital Management, Inc. (NYSE:NLY), Affiliated Managers Group, Inc. (NYSE:AMG), and HollyFrontier Corp (NYSE:HFC) to get a better sense of its popularity.
In the 21st century investor’s toolkit there are plenty of signals stock traders can use to assess stocks. A couple of the most under-the-radar signals are hedge fund and insider trading indicators. Our experts have shown that, historically, those who follow the top picks of the top fund managers can trounce the broader indices by a solid amount (see the details here).
With all of this in mind, let’s take a peek at the fresh action surrounding The Western Union Company (NYSE:WU).
How are hedge funds trading The Western Union Company (NYSE:WU)?
Heading into Q4, a total of 28 of the hedge funds tracked by Insider Monkey were long this stock, a change of -20% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, David Abrams’ Abrams Capital Management has the most valuable position in The Western Union Company (NYSE:WU), worth close to $396.7 million, accounting for 28.4% of its total 13F portfolio. On Abrams Capital Management’s heels is Winton Capital Management, led by David Harding, holding an $103 million position; the fund has 0.8% of its 13F portfolio invested in the stock. Some other members of the smart money with similar optimism comprise Joel Greenblatt’s Gotham Asset Management, Paul Marshall and Ian Wace’s Marshall Wace LLP and Phill Gross and Robert Atchinson’s Adage Capital Management.