Four stocks jumped into the green territory by midday on November 11 on the back of an Initial Public Offering, the involvement in legal matters, as well as the disclosure of the financial results for the last quarter. Let’s take a closer look at the developments behind the performance of these four stocks, which include Advanced Accelerator Applications S.A. (NASDAQ:AAAP), Xerox Corp. (NYSE:XRX), SunOpta Inc. (NASDAQ:STKL), and Glaukos Corp. (NYSE:GKOS). We’ll also look at the sentiment of top hedge funds in our database over these stocks.
An everyday investor does not have the time or the required skill-set to carry out an in-depth analysis of equities and identify companies with the best future prospects. Thus a retail investor is better off to monkey the most popular stock picks among hedge funds by him or herself. But not just any picks mind you. Our research has shown that a portfolio based on hedge funds’ top stock picks (which are invariably comprised entirely of large-cap companies) falls considerably short of a portfolio based on their best small-cap stock picks. The most popular large-cap stocks among hedge funds underperformed the market by an average of seven basis points per month in our backtests, whereas the 15 most popular small-cap stock picks among hedge funds outperformed the market by nearly a percentage point per month over the same period between 1999 and 2012. Since officially launching our small-cap strategy in August 2012 it has performed just as predicted, beating the market by over 53 percentage points and returning over 102%, while hedge funds have collectively underperformed the market (read more details here).
Shares of Advanced Accelerator Applications S.A. (NASDAQ:AAAP) surged by 44.38% by midday on Wednesday, a day after pricing its initial public offering of 4,688,000 American Depositary Shares at a price of $16.00 per ADS. The ADSs, which represent 9,376,000 of the company’s ordinary shares, have begun trading on the Nasdaq Global Select Market today. The company also granted the underwriters a 30-day over-allotment option to buy up to 703,200 additional ADSs.
Xerox Corp. (NYSE:XRX), which provides business process and document management solutions worldwide, gained 4.11% in light trading. The company inched up the charts Wednesday after the arrest of four people related to a toner cartridge scam, the Wesh.com reported on November 10. The scam was rooted to RBM Imaging, an authorized reseller, which was found to be buying bulk toner from Xerox and reselling the product in an unfair manner. By the end of June, 30 hedge funds in our database held 3.50% of the outstanding stock of Xerox Corp. (NYSE:XRX).