Investing in hedge funds can bring large profits, but it’s not for everybody, since hedge funds are available only for high-net-worth individuals. They generate significant returns for investors to justify their large fees and they allocate a lot of time and employ a complex analysis to determine the best stocks to invest in. A particularly interesting group of stocks that hedge funds like is the small-caps. The huge amount of capital does not allow hedge funds to invest a lot in small-caps, but our research showed that their most popular small-cap ideas are less efficiently priced and generate stronger returns than their large- and mega-cap picks and the broader market. That is why we follow the hedge fund activity in the small-cap space.
Is J&J Snack Foods Corp. (NASDAQ:JJSF) going to take off soon? The smart money is turning bullish. The number of bullish hedge fund positions increased by 2 in recent months. 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 NRG Yield, Inc. Class C (NYSE:NYLD), Esterline Technologies Corporation (NYSE:ESL), and Parsley Energy Inc (NYSE:PE) to gather more data points.
According to most stock holders, hedge funds are seen as worthless, outdated investment tools of yesteryear. While there are more than 8000 funds trading at the moment, We choose to focus on the upper echelon of this group, approximately 700 funds. These money managers oversee most of the smart money’s total capital, and by following their unrivaled equity investments, Insider Monkey has identified several investment strategies that have historically outperformed the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points per year for a decade in their back tests.
Keeping this in mind, let’s take a look at the latest action surrounding J&J Snack Foods Corp. (NASDAQ:JJSF).
What does the smart money think about J&J Snack Foods Corp. (NASDAQ:JJSF)?
At the end of the third quarter, a total of 9 of the hedge funds tracked by Insider Monkey held long positions in this stock, an increase of 29% from the second quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Renaissance Technologies has the most valuable position in J&J Snack Foods Corp. (NASDAQ:JJSF), worth close to $43.2 million, amounting to 0.1% of its total 13F portfolio. Sitting at the No. 2 spot is Fisher Asset Management, led by Ken Fisher, holding a $6.6 million position; less than 0.1% of its 13F portfolio is allocated to the company. Other hedge funds and institutional investors that hold long positions consist of Mario Gabelli’s GAMCO Investors, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Cliff Asness’ AQR Capital Management.