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Is East West Bancorp, Inc. (EWBC) a Good Buy?

With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. Renaissance Technologies, managed by Jim Simons, created the biggest position in East West Bancorp, Inc. (NASDAQ:EWBC). Renaissance Technologies had $22.5 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also made a $2.1 million investment in the stock during the quarter. The other funds with new positions in the stock are Ken Gray and Steve Walsh’s Bryn Mawr Capital, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Joseph A. Jolson’s Harvest Capital Strategies.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as East West Bancorp, Inc. (NASDAQ:EWBC) but similarly valued. We will take a look at Realogy Holdings Corp (NYSE:RLGY), Allegion PLC (NYSE:ALLE), IDEX Corporation (NYSE:IEX), and Randgold Resources Ltd. (ADR) (NASDAQ:GOLD). All of these stocks’ market caps are similar to EWBC’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
RLGY 48 2032810 6
ALLE 30 1168992 -3
IEX 15 196410 0
GOLD 16 164516 2

As you can see these stocks had an average of 27.25 hedge funds with bullish positions and the average amount invested in these stocks was $891 million. That figure was $296 million in EWBC’s case. Realogy Holdings Corp (NYSE:RLGY) is the most popular stock in this table. On the other hand IDEX Corporation (NYSE:IEX) is the least popular one with only 15 bullish hedge fund positions. East West Bancorp, Inc. (NASDAQ:EWBC) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard RLGY might be a better candidate to consider a long position.

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