Is Affiliated Managers Group, Inc. (AMG) Going to Burn These Hedge Funds?

The SEC requires hedge funds and wealthy investors with over a certain portfolio size to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings level the playing field for ordinary investors. The latest round of 13F filings discloses the funds’ positions on September 30. We at Insider Monkey have compiled an extensive database of more than 700 of those elite funds and prominent investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Affiliated Managers Group, Inc. (NYSE:AMG) based on those filings.

Affiliated Managers Group, Inc. (NYSE:AMG) was in 35 hedge funds’ portfolios at the end of September. AMG has experienced an increase in support from the world’s most elite money managers recently. There were 34 hedge funds in our database with AMG positions at the end of the previous quarter. At the end of this article we will also compare AMG to other stocks including Unum Group (NYSE:UNM), YPF SA (ADR) (NYSE:YPF), and Lear Corporation (NYSE:LEA) to get a better sense of its popularity.

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

Now, let’s take a gander at the latest action encompassing Affiliated Managers Group, Inc. (NYSE:AMG).

How have hedgies been trading Affiliated Managers Group, Inc. (NYSE:AMG)?

Heading into the fourth quarter of 2016, a total of 35 of the hedge funds tracked by Insider Monkey were bullish on this stock, up 3% from one quarter earlier. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the most valuable position in Affiliated Managers Group, Inc. (NYSE:AMG). The fund reportedly holds a $192.4 million position in the stock, comprising 0.2% of its 13F portfolio. Sitting at the No. 2 spot is Sirios Capital Management, run by John Brennan, which holds a $102.9 million position; 5.7% of its 13F portfolio is allocated to the stock. Other members of the smart money with similar optimism consist of Paul Marshall and Ian Wace’s Marshall Wace LLP, John Burbank’s Passport Capital and Israel Englander’s Millennium Management.

As industrywide interest jumped, specific money managers were leading the bulls’ herd. Passport Capital, managed by John Burbank, assembled the most valuable position in Affiliated Managers Group, Inc. (NYSE:AMG). The fund had $52.4 million invested in the company at the end of the quarter. Greg Poole’s Echo Street Capital Management also initiated a $15.6 million position during the quarter. The following funds were also among the new AMG investors: Joe DiMenna’s ZWEIG DIMENNA PARTNERS and Jim Simons’s Renaissance Technologies.

Let’s now review hedge fund activity in other stocks similar to Affiliated Managers Group, Inc. (NYSE:AMG). We will take a look at Unum Group (NYSE:UNM), YPF SA (ADR) (NYSE:YPF), Lear Corporation (NYSE:LEA), and Teck Resources Ltd (USA) (NYSE:TCK). All of these stocks’ market caps resemble AMG’s market cap.

As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $522 million. That figure was $747 million in AMG’s case. Teck Resources Ltd (USA) (NYSE:TCK) is the most popular stock in this table. On the other hand Unum Group (NYSE:UNM) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks Affiliated Managers Group, Inc. (NYSE:AMG) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.