Hedge Funds Are Buying Acadia Realty Trust (AKR)

At the end of February we announced the arrival of the first US recession since 2009 and we predicted that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards Acadia Realty Trust (NYSE:AKR).

Acadia Realty Trust (NYSE:AKR) investors should be aware of an increase in enthusiasm from smart money lately. AKR was in 14 hedge funds’ portfolios at the end of March. There were 13 hedge funds in our database with AKR positions at the end of the previous quarter. Our calculations also showed that AKR 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.

To most investors, hedge funds are perceived as worthless, outdated investment tools of years past. While there are more than 8000 funds trading today, Our researchers hone in on the moguls of this group, approximately 850 funds. These hedge fund managers manage most of all hedge funds’ total asset base, and by following their inimitable stock picks, Insider Monkey has found several investment strategies that have historically outpaced the market. Insider Monkey’s flagship short hedge fund strategy beat the S&P 500 short ETFs by around 20 percentage points annually 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 .

Dmitry Balyasny of Balyasny Asset Managemnet

Dmitry Balyasny of Balyasny Asset Management

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, blockchain technology’s influence will go beyond online payments. So, we are checking out this futurist’s moonshot opportunities in tech stocks. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind let’s go over the recent hedge fund action regarding Acadia Realty Trust (NYSE:AKR).

How are hedge funds trading Acadia Realty Trust (NYSE:AKR)?

At Q1’s end, a total of 14 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 8% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards AKR over the last 18 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Acadia Realty Trust (NYSE:AKR) was held by Balyasny Asset Management, which reported holding $7.6 million worth of stock at the end of September. It was followed by Citadel Investment Group with a $6.6 million position. Other investors bullish on the company included D E Shaw, Winton Capital Management, and Renaissance Technologies. In terms of the portfolio weights assigned to each position Tudor Investment Corp allocated the biggest weight to Acadia Realty Trust (NYSE:AKR), around 0.17% of its 13F portfolio. Winton Capital Management is also relatively very bullish on the stock, dishing out 0.11 percent of its 13F equity portfolio to AKR.

As industrywide interest jumped, key hedge funds were leading the bulls’ herd. Two Sigma Advisors, managed by John Overdeck and David Siegel, established the largest position in Acadia Realty Trust (NYSE:AKR). Two Sigma Advisors had $0.3 million invested in the company at the end of the quarter. Greg Eisner’s Engineers Gate Manager also made a $0.2 million investment in the stock during the quarter. The only other fund with a brand new AKR position is Mike Vranos’s Ellington.

Let’s go over hedge fund activity in other stocks similar to Acadia Realty Trust (NYSE:AKR). We will take a look at S & T Bancorp Inc (NASDAQ:STBA), Amneal Pharmaceuticals, Inc. (NYSE:AMRX), Air Transport Services Group Inc. (NASDAQ:ATSG), and Tompkins Financial Corporation (NYSE:TMP). All of these stocks’ market caps match AKR’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
STBA 4 3076 -5
AMRX 7 4326 -3
ATSG 22 116281 2
TMP 4 14209 -2
Average 9.25 34473 -2

View table here if you experience formatting issues.

As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $34 million. That figure was $32 million in AKR’s case. Air Transport Services Group Inc. (NASDAQ:ATSG) is the most popular stock in this table. On the other hand S & T Bancorp Inc (NASDAQ:STBA) is the least popular one with only 4 bullish hedge fund positions. Acadia Realty Trust (NYSE:AKR) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.3% in 2020 through June 25th but beat the market by 16.8 percentage points. Unfortunately AKR wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on AKR were disappointed as the stock returned 3.1% during the same time period 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 many of these stocks already outperformed the market so far this year.

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