Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 5 years and analyze what the smart money thinks of New York Mortgage Trust, Inc. (NASDAQ:NYMT) based on that data.
Is NYMT a good stock to buy now? New York Mortgage Trust, Inc. (NASDAQ:NYMT) investors should be aware of an increase in hedge fund sentiment lately. New York Mortgage Trust, Inc. (NASDAQ:NYMT) was in 19 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 15. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 15 hedge funds in our database with NYMT holdings at the end of June. Our calculations also showed that NYMT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
If you’d ask most investors, hedge funds are assumed to be slow, old investment vehicles of yesteryear. While there are greater than 8000 funds trading at present, Our experts choose to focus on the aristocrats of this group, about 850 funds. These hedge fund managers shepherd most of the smart money’s total capital, and by watching their matchless investments, Insider Monkey has determined a few investment strategies that have historically outperformed Mr. Market. Insider Monkey’s flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Now we’re going to check out the key hedge fund action regarding New York Mortgage Trust, Inc. (NASDAQ:NYMT).
Do Hedge Funds Think NYMT Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2020, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 27% from the second quarter of 2020. The graph below displays the number of hedge funds with bullish position in NYMT over the last 21 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, EJF Capital was the largest shareholder of New York Mortgage Trust, Inc. (NASDAQ:NYMT), with a stake worth $9.5 million reported as of the end of September. Trailing EJF Capital was Balyasny Asset Management, which amassed a stake valued at $8.7 million. Millennium Management, Arrowstreet Capital, and Almitas Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Almitas Capital allocated the biggest weight to New York Mortgage Trust, Inc. (NASDAQ:NYMT), around 3.56% of its 13F portfolio. Springhouse Capital Management is also relatively very bullish on the stock, designating 0.82 percent of its 13F equity portfolio to NYMT.
Now, specific money managers have been driving this bullishness. Ellington, managed by Mike Vranos, assembled the biggest position in New York Mortgage Trust, Inc. (NASDAQ:NYMT). Ellington had $2.3 million invested in the company at the end of the quarter. Matthew Hulsizer’s PEAK6 Capital Management also made a $1.2 million investment in the stock during the quarter. The other funds with brand new NYMT positions are Brian Gaines’s Springhouse Capital Management, Cliff Asness’s AQR Capital Management, and D. E. Shaw’s D E Shaw.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as New York Mortgage Trust, Inc. (NASDAQ:NYMT) but similarly valued. We will take a look at Atara Biotherapeutics Inc (NASDAQ:ATRA), Constellation Pharmaceuticals, Inc. (NASDAQ:CNST), The Greenbrier Companies Inc (NYSE:GBX), Oak Street Health, Inc. (NYSE:OSH), Encore Wire Corporation (NASDAQ:WIRE), Corecivic Inc. (NYSE:CXW), and National HealthCare Corporation (NYSE:NHC). This group of stocks’ market caps are closest to NYMT’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.4 hedge funds with bullish positions and the average amount invested in these stocks was $195 million. That figure was $42 million in NYMT’s case. Constellation Pharmaceuticals, Inc. (NASDAQ:CNST) is the most popular stock in this table. On the other hand National HealthCare Corporation (NYSE:NHC) is the least popular one with only 10 bullish hedge fund positions. New York Mortgage Trust, Inc. (NASDAQ:NYMT) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for NYMT is 67.1. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. A small number of hedge funds were also right about betting on NYMT as the stock returned 47.5% since the end of the third quarter (through 12/14) and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.