Do Hedge Funds Love Uxin Limited (UXIN)?

We at Insider Monkey have gone over 821 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think of Uxin Limited (NASDAQ:UXIN) based on that data.

Uxin Limited (NASDAQ:UXIN) investors should pay attention to an increase in hedge fund sentiment lately. Our calculations also showed that UXIN isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).

Video: Watch our video about the top 5 most popular hedge fund stocks.

If you’d ask most market participants, hedge funds are seen as slow, old investment vehicles of the past. While there are over 8000 funds trading at the moment, We choose to focus on the moguls of this group, approximately 850 funds. These investment experts handle bulk of the hedge fund industry’s total capital, and by observing their top equity investments, Insider Monkey has found many investment strategies that have historically outperformed the broader indices. Insider Monkey’s flagship short hedge fund strategy outstripped the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .

Lei Zhang Hillhouse Capital

Lei Zhang of Hillhouse Capital Management

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind let’s analyze the key hedge fund action encompassing Uxin Limited (NASDAQ:UXIN).

What does smart money think about Uxin Limited (NASDAQ:UXIN)?

At the end of the first quarter, a total of 5 of the hedge funds tracked by Insider Monkey were long this stock, a change of 25% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in UXIN over the last 18 quarters. With the smart money’s capital changing hands, there exists an “upper tier” of notable hedge fund managers who were adding to their holdings significantly (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Lei Zhang’s Hillhouse Capital Management has the biggest position in Uxin Limited (NASDAQ:UXIN), worth close to $11.2 million, accounting for 0.2% of its total 13F portfolio. The second most bullish fund manager is Renaissance Technologies, which holds a $0.9 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining members of the smart money with similar optimism include Ken Griffin’s Citadel Investment Group, and Israel Englander’s Millennium Management. In terms of the portfolio weights assigned to each position Hillhouse Capital Management allocated the biggest weight to Uxin Limited (NASDAQ:UXIN), around 0.15% of its 13F portfolio. Engineers Gate Manager is also relatively very bullish on the stock, setting aside 0.0014 percent of its 13F equity portfolio to UXIN.

As aggregate interest increased, specific money managers were leading the bulls’ herd. Citadel Investment Group, managed by Ken Griffin, assembled the biggest position in Uxin Limited (NASDAQ:UXIN). Citadel Investment Group had $0.4 million invested in the company at the end of the quarter. Greg Eisner’s Engineers Gate Manager also made a $0 million investment in the stock during the quarter.

Let’s also examine hedge fund activity in other stocks similar to Uxin Limited (NASDAQ:UXIN). These stocks are Aptose Biosciences Inc (NASDAQ:APTO), Orion Engineered Carbons SA (NYSE:OEC), GTT Communications Inc (NYSE:GTT), and BioXcel Therapeutics, Inc. (NASDAQ:BTAI). This group of stocks’ market caps resemble UXIN’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
APTO 15 154997 -4
OEC 21 104910 3
GTT 10 145022 -8
BTAI 10 35609 7
Average 14 110135 -0.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 14 hedge funds with bullish positions and the average amount invested in these stocks was $110 million. That figure was $12 million in UXIN’s case. Orion Engineered Carbons SA (NYSE:OEC) is the most popular stock in this table. On the other hand GTT Communications Inc (NYSE:GTT) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Uxin Limited (NASDAQ:UXIN) is even less popular than GTT. Hedge funds dodged a bullet by taking a bearish stance towards UXIN. Our calculations showed that the top 10 most popular hedge fund stocks returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 8.3% in 2020 through the end of May but managed to beat the market by 13.2 percentage points. Unfortunately UXIN wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was very bearish); UXIN investors were disappointed as the stock returned -0.6% during the second quarter (through the end of May) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market so far in 2020.

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Disclosure: None. This article was originally published at Insider Monkey.