In this article we will take a look at whether hedge funds think Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI) is a good investment right now. We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, unconventional data sources, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.
Is Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI) ready to rally soon? Investors who are in the know are taking an optimistic view. The number of long hedge fund positions advanced by 1 recently. Our calculations also showed that RMBI 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.
If you’d ask most stock holders, hedge funds are perceived as worthless, old investment vehicles of years past. While there are over 8000 funds in operation today, We hone in on the elite of this club, approximately 850 funds. These investment experts manage the lion’s share of the hedge fund industry’s total capital, and by observing their finest equity investments, Insider Monkey has determined various investment strategies that have historically outrun the broader indices. Insider Monkey’s flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. 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 latest hedge fund action surrounding Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI).
What have hedge funds been doing with Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI)?
At Q1’s end, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 25% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards RMBI over the last 18 quarters. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Seidman Investment Partnership, managed by Lawrence Seidman, holds the biggest position in Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI). Seidman Investment Partnership has a $2.3 million position in the stock, comprising 2.9% of its 13F portfolio. The second most bullish fund manager is Minerva Advisors, managed by David P. Cohen, which holds a $0.3 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Other members of the smart money with similar optimism comprise Renaissance Technologies, John Overdeck and David Siegel’s Two Sigma Advisors and Matthew Lindenbaum’s Basswood Capital. In terms of the portfolio weights assigned to each position Seidman Investment Partnership allocated the biggest weight to Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI), around 2.88% of its 13F portfolio. Minerva Advisors is also relatively very bullish on the stock, setting aside 0.24 percent of its 13F equity portfolio to RMBI.
Consequently, key money managers have jumped into Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI) headfirst. Renaissance Technologies, established the largest position in Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI). Renaissance Technologies had $0.2 million invested in the company at the end of the quarter.
Let’s go over hedge fund activity in other stocks similar to Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI). We will take a look at Taiwan Liposome Company, Ltd. (NASDAQ:TLC), Bluerock Residential Growth REIT Inc (NYSE:BRG), Enochian Biosciences Inc. (NASDAQ:ENOB), and KalVista Pharmaceuticals, Inc. (NASDAQ:KALV). This group of stocks’ market valuations resemble RMBI’s market valuation.
|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 7.5 hedge funds with bullish positions and the average amount invested in these stocks was $13 million. That figure was $3 million in RMBI’s case. KalVista Pharmaceuticals, Inc. (NASDAQ:KALV) is the most popular stock in this table. On the other hand Taiwan Liposome Company, Ltd. (NASDAQ:TLC) is the least popular one with only 1 bullish hedge fund positions. Richmond Mutual Bancorporation, Inc. (NASDAQ:RMBI) 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. 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 surpassed the market by 13.2 percentage points. Unfortunately RMBI wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); RMBI investors were disappointed as the stock returned 9% during the second quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.