The elite funds run by legendary investors such as Dan Loeb and David Tepper make hundreds of millions of dollars for themselves and their investors by spending enormous resources doing research on small cap stocks that big investment banks don’t follow. Because of their pay structures, they have strong incentive to do the research necessary to beat the market. That’s why we pay close attention to what they think in small cap stocks. In this article, we take a closer look at Arlington Asset Investment Corp (NYSE:AI) from the perspective of those elite funds.
Arlington Asset Investment Corp (NYSE:AI) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 7 hedge funds’ portfolios at the end of the third quarter of 2015. It might appear a bit surprising, considering that the shares of Arlington Asset Investment Corp (NYSE:AI) dropped in excess of 28.17% throughout the quarter. These developments prompted us to find out about the hedge funds holding positions in the company, at the end of the previous quarter.
At the end of this article, we will also compare AI to other stocks including Wausau Paper Corp. (NYSE:WPP), Vimicro International Corporation (ADR) (NASDAQ:VIMC), and Build-A-Bear Workshop, Inc (NYSE:BBW) to get a better sense of its popularity.
In the eyes of most investors, hedge funds are perceived as slow, outdated financial tools of the past. While there are greater than 8000 funds trading today, our experts choose to focus on the aristocrats of this club, about 700 funds. These money managers handle most of the smart money’s total capital, and by monitoring their finest equity investments, Insider Monkey has spotted various investment strategies that have historically outstripped the broader indices. Insider Monkey’s small-cap hedge fund strategy surpassed the S&P 500 index by 12 percentage points a year for a decade in their back tests.
Keeping this in mind, we’re going to check out the key action regarding Arlington Asset Investment Corp (NYSE:AI).
How have hedgies been trading Arlington Asset Investment Corp (NYSE:AI)?
At the end of the third quarter, a total of 7 of the hedge funds tracked by Insider Monkey held long positions in this stock, unchanged from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Renaissance Technologies holds the number one position in Arlington Asset Investment Corp (NYSE:AI). Renaissance Technologies has a $4.1 million position in the stock, comprising less than 0.1% of its 13F portfolio. The second most bullish fund manager is Israel Englander of Millennium Management, with a $2 million position; less than 0.1% of its 13F portfolio is allocated to the stock. Some other hedge funds and institutional investors that hold long positions consist of Matthew Hulsizer’s PEAK6 Capital Management, Cliff Asness’ AQR Capital Management, and Charles Akre’s Akre Capital Management.