Hedge Funds Are Selling New Residential Investment Corp (NRZ)

Because New Residential Investment Corp (NYSE:NRZ) has faced falling interest from the smart money, we can see that there were a few hedge funds that slashed their full holdings by the end of the third quarter. It’s worth mentioning that Alec Litowitz and Ross Laser’s Magnetar Capital sold off the largest position of all the hedgies monitored by Insider Monkey, comprising about $21.3 million in stock, and Dmitry Balyasny’s Balyasny Asset Management was right behind this move, as the fund dropped about $12.1 million worth of NRZ shares. These bearish behaviors are interesting, as total hedge fund interest was cut by 5 funds by the end of the third quarter.

Let’s now take a look at hedge fund activity in other stocks similar to New Residential Investment Corp (NYSE:NRZ). We will take a look at PrivateBancorp Inc (NASDAQ:PVTB), Federated Investors Inc (NYSE:FII), Integrated Device Technology, Inc. (NASDAQ:IDTI), and SolarWinds Inc (NYSE:SWI). This group of stocks’ market values match NRZ’s market value.

As you can see these stocks had an average of 22 hedge funds with bullish positions and the average amount invested in these stocks was $358 million. That figure was $674 million in NRZ’s case. Integrated Device Technology, Inc. (NASDAQ:IDTI) is the most popular stock in this table, whereas Federated Investors Inc (NYSE:FII) is the least popular one with only 12 bullish hedge fund positions. New Residential Investment Corp (NYSE:NRZ) is not the most popular stock in this group, but hedge fund interest is still above average. Although this is a slightly positive signal, we’d rather spend our time researching stocks that hedge funds are piling on. In this regard IDTI might be a better candidate to consider a long position.