Hedge fund managers like David Einhorn, Dan Loeb, and Carl Icahn became billionaires through reaping large profits for their investors, which is why piggybacking their stock picks may provide us with significant returns as well. Many hedge funds, like Paul Singer’s Elliott Management, are pretty secretive, but we can still get some insights by analyzing their quarterly 13F filings. One of the most fertile grounds for large abnormal returns is hedge funds’ most popular small-cap picks, which are not so widely followed and often trade at a discount to their intrinsic value. In this article we will check out hedge fund activity in another small-cap stock: Rubicon Minerals Corp. (USA) (NYSEAMEX:RBY).
Is Rubicon Minerals Corp. (USA) (NYSEAMEX:RBY) a buy, sell, or hold? The smart money is selling. The number of bullish hedge fund positions went down by 3 recently. At the end of this article we will also compare Rubicon Minerals Corp. to other stocks including Arctic Cat Inc (NASDAQ:ACAT), Pace Holdings Corp (NASDAQ:PACE), and Bank of Marin Bancorp (NASDAQ:BMRC) to get a better sense of its popularity.
In the eyes of most shareholders, hedge funds are viewed as slow, outdated financial vehicles of the past. While there are greater than 8,000 funds trading at the moment, we choose to focus on the elite of this group, around 700 funds. These money managers oversee the majority of all hedge funds’ total asset base, and by paying attention to their top picks, Insider Monkey has discovered many investment strategies that have historically outstripped the market. Insider Monkey’s small-cap hedge fund strategy outpaced the S&P 500 index by 12 percentage points a year for a decade in their back tests.
With all of this in mind, we’re going to review the recent action surrounding Rubicon Minerals Corp. (USA) (NYSEAMEX:RBY).
Hedge fund activity in Rubicon Minerals Corp. (USA) (NYSEAMEX:RBY)
At the end of the third quarter, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a 43% slide from the second quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Jonathan Savitz’s Greywolf Capital Management has the most valuable position in Rubicon Minerals Corp. (USA) (NYSEAMEX:RBY), worth close to $26.3 million, accounting for 4.3% of its total 13F portfolio. The second-most bullish fund manager is Israel Englander of Millennium Management, with a $1.2 million position; less than 0.1% of its 13F portfolio is allocated to the company. Some other hedge funds and institutional investors with similar optimism consist of Eric Sprott’s Sprott Asset Management, and D E Shaw.