It is already common knowledge that individual investors do not usually have the necessary resources and abilities to properly research an investment opportunity. As a result, most investors pick their illusory “winners” by making a superficial analysis and research that leads to poor performance on aggregate. The Standard and Poor’s 500 Index returned 5.2% over the 12-month period ending October 30, while more than 51% of the constituents of the index underperformed the benchmark. Hence, a random stock picking process will most likely lead to disappointment. At the same time, the 30 most favored S&P 500 stocks by the hedge funds monitored by Insider Monkey (as of September 2014) generated a return of 9.5% over the same time span, with 63% of these stocks outperforming the benchmark. Of course, hedge funds do make wrong bets on some occasions and these get disproportionately publicized on financial media, but piggybacking their moves can beat the broader market on average. That’s why we are going to go over recent hedge fund activity in Twitter Inc (NYSE:TWTR).
Is Twitter Inc (NYSE:TWTR) worth your attention right now? The best stock pickers are becoming less confident. The number of bullish hedge fund bets were trimmed by 20 in recent months. TWTR was in 27 hedge funds’ portfolios at the end of September. There were 47 hedge funds in our database with TWTR holdings at the end of the previous quarter. At the end of this article we will also compare TWTR to other stocks including Boston Properties, Inc. (NYSE:BXP), Sasol Limited (ADR) (NYSE:SSL), and Pioneer Natural Resources (NYSE:PXD) to get a better sense of its popularity.
With all of this in mind, we’re going to take a glance at the recent action surrounding Twitter Inc (NYSE:TWTR).
What does the smart money think about Twitter Inc (NYSE:TWTR)?
At Q3’s end, a total of 27 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -43% from the previous quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Ken Griffin’s Citadel Investment Group has the biggest call position in Twitter Inc (NYSE:TWTR), worth close to $52.2 million, comprising 0.1% of its total 13F portfolio. The second largest stake is held by D E Shaw, with an $29.1 million position; the fund has less than 0.1% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that are bullish consist of Brian Ashford-Russell and Tim Woolley’s Polar Capital and Matthew Hulsizer’s PEAK6 Capital Management.