Insider Monkey finished processing more than 700 13F filings made by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of September 30. In this article we are going to take a look at smart money sentiment towards Olin Corporation (NYSE:OLN) .
Olin Corporation (NYSE:OLN) shareholders have witnessed a decrease in enthusiasm from smart money of late. OLN was in 18 hedge funds’ portfolios at the end of September. There were 28 hedge funds in our database with OLN positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as IDACORP Inc (NYSE:IDA), Advanced Micro Devices, Inc. (NYSE:AMD), and Lincoln Electric Holdings, Inc. (NASDAQ:LECO) to gather more data points.
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.
Keeping this in mind, let’s take a look at the key action encompassing Olin Corporation (NYSE:OLN).
How have hedgies been trading Olin Corporation (NYSE:OLN)?
At the end of the third quarter, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -36% from the previous quarter. By comparison, 35 hedge funds held shares or bullish call options in OLN heading into this year. With the smart money’s capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Phill Gross and Robert Atchinson’s Adage Capital Management has the number one position in Olin Corporation (NYSE:OLN), worth close to $243.5 million, corresponding to 0.7% of its total 13F portfolio. Sitting at the No. 2 spot is Dmitry Balyasny of Balyasny Asset Management, with a $137.8 million position; the fund has 0.8% of its 13F portfolio invested in the stock. Other peers that are bullish contain Seth Klarman’s Baupost Group, Michael Lowenstein’s Kensico Capital and David Cohen and Harold Levy’s Iridian Asset Management. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
Now that we’ve mentioned the most bullish investors, let’s also take a look at some funds that got rid of their entire stakes in the stock during the third quarter. Intriguingly, Jean-Marie Eveillard’s First Eagle Investment Management got rid of the largest investment of the 700 funds watched by Insider Monkey, worth close to $70.3 million in stock, and Jonathan Barrett and Paul Segal’s Luminus Management was right behind this move, as the fund dumped about $25.4 million worth of shares.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Olin Corporation (NYSE:OLN) but similarly valued. We will take a look at IDACORP Inc (NYSE:IDA), Advanced Micro Devices, Inc. (NYSE:AMD), Lincoln Electric Holdings, Inc. (NASDAQ:LECO), and Juno Therapeutics Inc (NASDAQ:JUNO). This group of stocks’ market values resemble OLN’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 21.5 hedge funds with bullish positions and the average amount invested in these stocks was $264 million. That figure was $989 million in OLN’s case. Advanced Micro Devices, Inc. (NYSE:AMD) is the most popular stock in this table. On the other hand IDACORP Inc (NYSE:IDA) is the least popular one with only 6 bullish hedge fund positions. Olin Corporation (NYSE:OLN) 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 AMD might be a better candidate to consider taking a long position in.