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Hedge Funds Are Crazy About Neuberger Berman High Yield Strateges Fd (NHS)

The elite funds run by legendary investors such as Dan Loeb and David Tepper make hundreds of millions of dollars for themselves and their investors by spending enormous resources doing research on small cap stocks that big investment banks don’t follow. Because of their pay structures, they have strong incentive to do the research necessary to beat the market. That’s why we pay close attention to what they think in small cap stocks. In this article, we take a closer look at Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS) from the perspective of those elite funds.

Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS) investors should pay attention to an increase in enthusiasm from smart money in recent months. It might come as a surprise, considering that the stock lost 13.5% of its value during the quarter. For understanding more about the hedge fund sentiment, we will discuss hedge funds that held stakes in Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS), at the end of September.

In order to decipher the hedge behavior, we will also compare Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS) to other stocks including Northrim BanCorp, Inc. (NASDAQ:NRIM), Denison Mines Corp (NYSEMKT:DNN), and Control4 Corp (NASDAQ:CTRL) to get a better sense of its popularity.

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In the financial world, there are plenty of indicators market participants can use to appraise publicly traded companies. A pair of the less utilized indicators are hedge fund and insider trading sentiment. Our experts have shown that, historically, those who follow the top picks of the best hedge fund managers can trounce the S&P 500 by a very impressive amount (see the details here).

With all of this in mind, we’re going to take a peek at the fresh action surrounding Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS).

What have hedge funds been doing with Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS)?

At the end of the third quarter, a total of 5 of the hedge funds tracked by Insider Monkey were long this stock, an increase of 25% from the second quarter. With the smart money’s sentiment swirling, there exists a select group of notable hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Saba Capital, managed by Boaz Weinstein, holds the most valuable position in Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS). Saba Capital has a $11.5 million position in the stock, comprising 0.9% of its 13F portfolio. Coming in second is Martin Whitman of Third Avenue Management, with a $4.3 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining members of the smart money that are bullish comprise Brian Taylor’s Pine River Capital Management, Clint Carlson’s Carlson Capital, and William Michaelcheck’s Mariner Investment Group.

With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Mariner Investment Group, managed by William Michaelcheck, assembled the biggest position in Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS). Mariner Investment Group had $0.4 million invested in the company at the end of the quarter.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS) but similarly valued. We will take a look at Northrim BanCorp, Inc. (NASDAQ:NRIM), Denison Mines Corp (NYSEMKT:DNN), Control4 Corp (NASDAQ:CTRL), and Mattersight Corporation (NASDAQ:MATR). All of these stocks’ market caps match Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS)’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NRIM 7 22074 -1
DNN 4 1285 0
CTRL 6 24767 -1
MATR 5 31181 1

As you can see, these stocks had an average of 6 hedge funds with bullish positions and the average amount invested in these stocks was $20 million. That figure was $22 million in Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS)’s case. Northrim BanCorp, Inc. (NASDAQ:NRIM) is the most popular stock in this table. On the other hand, Denison Mines Corp (NYSEMKT:DNN) is the least popular one with only 4 bullish hedge fund positions. Neuberger Berman High Yield Strateges Fd (NYSEMKT:NHS) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard, Northrim BanCorp, Inc. (NASDAQ:NRIM) might be a better candidate to consider a long position.

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