In this article we will check out the progression of hedge fund sentiment towards ASA Gold and Precious Metals Ltd (NYSE:ASA) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.
Hedge fund interest in ASA Gold and Precious Metals Ltd (NYSE:ASA) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare ASA to other stocks including Team, Inc. (NYSE:TISI), Silicom Ltd. (NASDAQ:SILC), and Funko, Inc. (NASDAQ:FNKO) to get a better sense of its popularity.
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If you’d ask most traders, hedge funds are assumed to be underperforming, old financial vehicles of the past. While there are over 8000 funds with their doors open today, Our researchers look at the masters of this group, approximately 850 funds. These investment experts have their hands on bulk of the smart money’s total capital, and by following their finest investments, Insider Monkey has determined numerous investment strategies that have historically outpaced the broader indices. Insider Monkey’s flagship short hedge fund strategy exceeded the S&P 500 short ETFs by around 20 percentage points a 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. Keeping this in mind we’re going to take a glance at the fresh hedge fund action regarding ASA Gold and Precious Metals Ltd (NYSE:ASA).
Hedge fund activity in ASA Gold and Precious Metals Ltd (NYSE:ASA)
Heading into the second quarter of 2020, a total of 5 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in ASA over the last 18 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Royce & Associates held the most valuable stake in ASA Gold and Precious Metals Ltd (NYSE:ASA), which was worth $4.3 million at the end of the third quarter. On the second spot was Water Street Capital which amassed $4.3 million worth of shares. Bulldog Investors, GRT Capital Partners, and Ancora Advisors were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Bulldog Investors allocated the biggest weight to ASA Gold and Precious Metals Ltd (NYSE:ASA), around 0.58% of its 13F portfolio. Water Street Capital is also relatively very bullish on the stock, earmarking 0.47 percent of its 13F equity portfolio to ASA.
Judging by the fact that ASA Gold and Precious Metals Ltd (NYSE:ASA) has witnessed bearish sentiment from the entirety of the hedge funds we track, it’s easy to see that there exists a select few fund managers who were dropping their full holdings in the first quarter. At the top of the heap, Ron Mass’s Almitas Capital cut the biggest investment of the 750 funds followed by Insider Monkey, worth about $1.2 million in stock. Bart Baum’s fund, Ionic Capital Management, also said goodbye to its stock, about $0.5 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as ASA Gold and Precious Metals Ltd (NYSE:ASA) but similarly valued. We will take a look at Team, Inc. (NYSE:TISI), Silicom Ltd. (NASDAQ:SILC), Funko, Inc. (NASDAQ:FNKO), and Weyco Group, Inc. (NASDAQ:WEYS). All of these stocks’ market caps resemble ASA’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 8 hedge funds with bullish positions and the average amount invested in these stocks was $12 million. That figure was $10 million in ASA’s case. Funko, Inc. (NASDAQ:FNKO) is the most popular stock in this table. On the other hand Weyco Group, Inc. (NASDAQ:WEYS) is the least popular one with only 4 bullish hedge fund positions. ASA Gold and Precious Metals Ltd (NYSE:ASA) is not the least popular stock in this group but hedge fund interest is still below average. 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 ASA as the stock returned 48.5% during the second quarter and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.