Here’s Why Alluvial Capital Remains Confident in Rand Worldwide (RWWI)

Alluvial Capital Management, an investment management firm, published its second-quarter 2021 investor letter – a copy of which can be downloaded here. A return of 7.0% was delivered by the fund for the Q2 of 2021. Returns for the quarter, year-to-date, and since inception periods comfortably exceed all relevant benchmarks. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

In the Q2 2021 investor letter of Alluvial Capital Management, the fund mentioned Rand Worldwide, Inc. (NYSE: RWWI) and discussed its stance on the firm. Rand Worldwide, Inc. is a Maryland, United States-based software company with a $518.1 million market capitalization. RWWI delivered a 20.46% return since the beginning of the year, while its 12-month returns are up by 22.64%. The stock closed at $15.85 per share on September 10, 2021.

Here is what Alluvial Capital Management has to say about Rand Worldwide, Inc. in its Q2 2021 investor letter:

“I never have to worry about idle cash with Peter Kamin-controlled company Rand Worldwide. Rand Worldwide is riding high on continued demand for its software solutions and a recent re-financing and has paid out $1.75 per share this year.”

Based on our calculations, Rand Worldwide, Inc. (NYSE: RWWI) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. Rand Worldwide, Inc. (NYSE: RWWI) delivered a -2.99% return in the past 3 months.

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 has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 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 underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.

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Disclosure: None. This article is originally published at Insider Monkey.