Hedge Funds Are Buying AngloGold Ashanti Limited (AU)

The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st, about a week after the S&P 500 Index bottomed. We at Insider Monkey have made an extensive database of more than 821 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded AngloGold Ashanti Limited (NYSE:AU) based on those filings.

AngloGold Ashanti Limited (NYSE:AU) has experienced an increase in support from the world’s most elite money managers lately. Our calculations also showed that AU 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To most stock holders, hedge funds are seen as unimportant, outdated financial vehicles of yesteryear. While there are over 8000 funds trading today, Our researchers look at the crème de la crème of this club, around 850 funds. It is estimated that this group of investors administer the lion’s share of the smart money’s total asset base, and by tailing their top picks, Insider Monkey has brought to light several investment strategies that have historically defeated Mr. Market. Insider Monkey’s flagship short hedge fund strategy outrun 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 .


Louis Bacon Moore of Moore Capital

We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. 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. With all of this in mind we’re going to go over the recent hedge fund action surrounding AngloGold Ashanti Limited (NYSE:AU).

What does smart money think about AngloGold Ashanti Limited (NYSE:AU)?

At Q1’s end, a total of 19 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 12% from one quarter earlier. On the other hand, there were a total of 23 hedge funds with a bullish position in AU a year ago. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Paulson & Co, managed by John Paulson, holds the biggest position in AngloGold Ashanti Limited (NYSE:AU). Paulson & Co has a $188.7 million position in the stock, comprising 7.2% of its 13F portfolio. The second most bullish fund of Renaissance Technologies, with a $58.3 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining peers that hold long positions include Eric Sprott’s Sprott Asset Management, Howard Marks’s Oaktree Capital Management and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital. In terms of the portfolio weights assigned to each position Paulson & Co allocated the biggest weight to AngloGold Ashanti Limited (NYSE:AU), around 7.2% of its 13F portfolio. Sprott Asset Management is also relatively very bullish on the stock, setting aside 4.55 percent of its 13F equity portfolio to AU.

Now, specific money managers have jumped into AngloGold Ashanti Limited (NYSE:AU) headfirst. Moore Global Investments, managed by Louis Bacon, established the most outsized position in AngloGold Ashanti Limited (NYSE:AU). Moore Global Investments had $1.7 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP also made a $1.3 million investment in the stock during the quarter. The other funds with new positions in the stock are Lee Ainslie’s Maverick Capital, Ronald Hua’s Qtron Investments, and Paul Tudor Jones’s Tudor Investment Corp.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as AngloGold Ashanti Limited (NYSE:AU) but similarly valued. We will take a look at Luckin Coffee Inc. (NASDAQ:LK), Fidelity National Financial Inc (NYSE:FNF), Cabot Oil & Gas Corporation (NYSE:COG), and Iron Mountain Incorporated (NYSE:IRM). This group of stocks’ market values match AU’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
LK 36 1056167 3
FNF 43 386182 7
COG 37 469345 3
IRM 19 49061 2
Average 33.75 490189 3.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 33.75 hedge funds with bullish positions and the average amount invested in these stocks was $490 million. That figure was $399 million in AU’s case. Fidelity National Financial Inc (NYSE:FNF) is the most popular stock in this table. On the other hand Iron Mountain Incorporated (NYSE:IRM) is the least popular one with only 19 bullish hedge fund positions. Compared to these stocks AngloGold Ashanti Limited (NYSE:AU) is even less popular than IRM. Hedge funds clearly dropped the ball on AU as the stock delivered strong returns, though hedge funds’ consensus picks still generated respectable returns. 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 13.4% in 2020 through June 22nd and still beat the market by 15.9 percentage points. A small number of hedge funds were also right about betting on AU as the stock returned 66% so far in the second quarter and outperformed the market by an even larger margin.

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