World-class money managers like Bill Ackman and Barry Rosenstein only invest their wealthy clients’ money after undertaking a rigorous examination of any potential stock. They are particularly successful in this regard when it comes to small-cap stocks, which their peerless research gives them a big information advantage on when it comes to judging their worth. It’s not surprising then that they generate their biggest returns from these stocks and invest more of their money in these stocks on average than other investors. It’s also not surprising then that we pay close attention to these picks ourselves and have built a market-beating investment strategy around them.
Is Xenon Pharmaceuticals Inc (NASDAQ:XENE) ready to rally soon? The best stock pickers are taking a bearish view. The number of bullish hedge fund bets retreated by 1 in recent months. At the end of this article, we will also compare XENE to other stocks, including Hugoton Royalty Trust (NYSE:HGT), Hardinge Inc. (NASDAQ:HDNG), and Provectus Biopharmaceuticals Inc (NYSEMKT:PVCT) to get a better sense of its popularity.
In the eyes of most stock holders, hedge funds are assumed to be worthless, outdated financial vehicles of years past. While there are more than 8000 funds trading at the moment, our researchers choose to focus on the elite of this club, approximately 700 funds. It is estimated that this group of investors manages the lion’s share of all hedge funds’ total asset base, and by watching their highest performing picks, Insider Monkey has determined a few investment strategies that have historically exceeded Mr. Market. Insider Monkey’s small-cap hedge fund strategy beat the S&P 500 index by 12 percentage points annually for a decade in their back tests.
With all of this in mind, let’s view the latest action encompassing Xenon Pharmaceuticals Inc (NASDAQ:XENE).
How have hedgies been trading Xenon Pharmaceuticals Inc (NASDAQ:XENE)?
At the end of September, a total of 8 of the hedge funds tracked by Insider Monkey held long positions in this stock, a decline of 11% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were increasing their holdings meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Biotechnology Value Fund/BVF Inc, managed by Mark Lampert, holds the biggest position in Xenon Pharmaceuticals Inc (NASDAQ:XENE). The fund has an $8.6 million position in the stock, comprising 1.7% of its 13F portfolio. The second largest stake is held by Invesco Private Capital (WL Ross), managed by Wilbur Ross, which holds a $3.7 million position; the fund has 0.8% of its 13F portfolio invested in the stock. Hedge funds and other institutional investors that hold long positions encompass Jacob Gottlieb’s Visium Asset Management, Steve Cohen’s Point72 Asset Management and Joseph Edelman’s Perceptive Advisors.