Reputable billionaire investors such as Nelson Peltz and David Tepper generate exorbitant profits for their wealthy accredited investors (a minimum of $1 million in investable assets would be required to invest in a hedge fund and most successful hedge funds won’t accept your savings unless you commit at least $5 million) by pinpointing winning small-cap stocks. There is little or no publicly-available information at all on some of these small companies, which makes it hard for an individual investor to pin down a winner within the small-cap space. However, hedge funds and other big asset managers can do the due diligence and analysis for you instead, thanks to their highly-skilled research teams and vast resources to conduct an appropriate evaluation process. Looking for potential winners within the small-cap galaxy of stocks? We believe following the smart money is a good starting point.
Helix Energy Solutions Group Inc. (NYSE:HLX) shareholders have witnessed an increase in hedge fund interest of late. HLX was in 19 hedge funds’ portfolios at the end of September. There were 18 hedge funds in our database with HLX positions at the end of the previous quarter. 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 At Home Group Inc (NYSE:HOME), Cato Corp (NYSE:CATO), and Rofin-Sinar Technologies (NASDAQ:RSTI) to gather more data points.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
What does the smart money think about Helix Energy Solutions Group Inc. (NYSE:HLX)?
At Q3’s end, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, up by 6% from the second quarter of 2016. On the other hand, there were a total of 10 hedge funds with a bullish position in HLX at the beginning of this year. With the smart money’s capital changing hands, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, GMT Capital, led by Thomas E. Claugus, holds the largest position in Helix Energy Solutions Group Inc. (NYSE:HLX). GMT Capital has a $59.1 million position in the stock, comprising 1.2% of its 13F portfolio. The second most bullish fund is Israel Englander’s Millennium Management, one of the 10 largest hedge funds in the world, with a $49.9 million position. Some other hedge funds and institutional investors with similar optimism encompass Michael Platt and William Reeves’ BlueCrest Capital Mgmt., John Overdeck and David Siegel’s Two Sigma Advisors and Jim Simons’ Renaissance Technologies. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.