The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. In this article we are going to take a look at smart money sentiment towards Rubius Therapeutics, Inc. (NASDAQ:RUBY).
Is Rubius Therapeutics, Inc. (NASDAQ:RUBY) worth your attention right now? The best stock pickers are in a pessimistic mood. The number of bullish hedge fund positions fell by 1 recently. Our calculations also showed that RUBY 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.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 44 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 36% through May 18th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, we believe electric vehicles and energy storage are set to become giant markets, and we want to take advantage of the declining lithium prices amid the COVID-19 pandemic. So we are checking out investment opportunities like this one. 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. Now let’s take a peek at the key hedge fund action surrounding Rubius Therapeutics, Inc. (NASDAQ:RUBY).
How have hedgies been trading Rubius Therapeutics, Inc. (NASDAQ:RUBY)?
At Q1’s end, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of -20% from the previous quarter. On the other hand, there were a total of 5 hedge funds with a bullish position in RUBY a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Ken Griffin’s Citadel Investment Group has the biggest position in Rubius Therapeutics, Inc. (NASDAQ:RUBY), worth close to $0.6 million, comprising less than 0.1%% of its total 13F portfolio. On Citadel Investment Group’s heels is John Overdeck and David Siegel of Two Sigma Advisors, with a $0.1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other peers that are bullish comprise Israel Englander’s Millennium Management, Greg Eisner’s Engineers Gate Manager and . In terms of the portfolio weights assigned to each position Engineers Gate Manager allocated the biggest weight to Rubius Therapeutics, Inc. (NASDAQ:RUBY), around 0.0035% of its 13F portfolio. Two Sigma Advisors is also relatively very bullish on the stock, designating 0.0005 percent of its 13F equity portfolio to RUBY.
Due to the fact that Rubius Therapeutics, Inc. (NASDAQ:RUBY) has witnessed bearish sentiment from the entirety of the hedge funds we track, it’s safe to say that there was a specific group of fund managers that elected to cut their full holdings heading into Q4. It’s worth mentioning that Oleg Nodelman’s EcoR1 Capital sold off the biggest stake of the 750 funds tracked by Insider Monkey, comprising an estimated $5 million in stock. Minhua Zhang’s fund, Weld Capital Management, also cut its stock, about $0.6 million worth. These transactions are important to note, as aggregate hedge fund interest fell by 1 funds heading into Q4.
Let’s check out hedge fund activity in other stocks similar to Rubius Therapeutics, Inc. (NASDAQ:RUBY). We will take a look at Catchmark Timber Trust Inc (NYSE:CTT), Schnitzer Steel Industries, Inc. (NASDAQ:SCHN), Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM), and NeoPhotonics Corp (NYSE:NPTN). All of these stocks’ market caps match RUBY’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.5 hedge funds with bullish positions and the average amount invested in these stocks was $64 million. That figure was $1 million in RUBY’s case. NeoPhotonics Corp (NYSE:NPTN) is the most popular stock in this table. On the other hand Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks Rubius Therapeutics, Inc. (NASDAQ:RUBY) is even less popular than MIRM. Hedge funds clearly dropped the ball on RUBY 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 8.3% in 2020 through the end of May and still beat the market by 13.2 percentage points. A small number of hedge funds were also right about betting on RUBY as the stock returned 44.9% 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.