Hedge Funds Are Betting On MarketAxess Holdings Inc. (MKTX)

As industrywide interest jumped, key hedge funds have been driving this bullishness. Junto Capital Management, initiated the most valuable position in MarketAxess Holdings Inc. (NASDAQ:MKTX). George Hall’s Clinton Group also initiated a $1.6 million position during the quarter. The other funds with brand new MKTX positions are Israel Englander’s Millennium Management, Jacob Gottlieb’s Visium Asset Management, and Matthew Hulsizer’s PEAK6 Capital Management.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as MarketAxess Holdings Inc. (NASDAQ:MKTX) but similarly valued. These stocks are Spirit Airlines Incorporated (NASDAQ:SAVE), Eagle Materials, Inc. (NYSE:EXP), Prosperity Bancshares, Inc. (NYSE:PB), and Youku Tudou Inc (ADR) (NYSE:YOKU). This group of stocks’ market values are similar to MKTX’s market value.

As you can see these stocks had an average of 27 hedge funds with bullish positions and the average amount invested in these stocks was $414 million, compared to $100 million in MKTX’s case. Spirit Airlines Incorporated (NASDAQ:SAVE) is the most popular stock in this table. On the other hand Youku Tudou Inc (ADR) (NYSE:YOKU) is the least popular one with only 15 bullish hedge fund positions. Compared to these stocks MarketAxess Holdings Inc. (NASDAQ:MKTX) is even less popular than YOKU. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.