There are several ways to beat the market, and investing in small cap stocks has historically been one of them. We like to improve the odds of beating the market further by examining what famous hedge fund operators such as Carl Icahn and George Soros think. Those hedge fund operators make billions of dollars each year by hiring the best and the brightest to do research on stocks, including small cap stocks that big brokerage houses simply don’t cover. Because of Carl Icahn and other elite funds’ exemplary historical records, we pay attention to their small cap picks. In this article, we use hedge fund filing data to analyze Public Storage (NYSE:PSA).
Is Public Storage (NYSE:PSA) an exceptional investment right now? The smart money is unfortunately becoming less hopeful. The number of bullish hedge fund bets were trimmed by 4 in recent months. PSA was in 23 hedge funds’ portfolios at the end of the third quarter of 2016. There were 27 hedge funds in our database with PSA holdings 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 Caterpillar Inc. (NYSE:CAT), Paypal Holdings Inc (NASDAQ:PYPL), and General Motors Company (NYSE:GM) 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 glance at the new action regarding Public Storage (NYSE:PSA).
Hedge fund activity in Public Storage (NYSE:PSA)
At Q3’s end, a total of 23 of the hedge funds tracked by Insider Monkey were bullish on this stock, a plunge of 15% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, AEW Capital Management, run by Jeffrey Furber, holds the number one position in Public Storage (NYSE:PSA). According to its latest 13F filing, the fund has a $283.1 million position in the stock, comprising 5.9% of its 13F portfolio. On AEW Capital Management’s heels is Peter Rathjens, Bruce Clarke and John Campbell of Arrowstreet Capital, with a $244.1 million position; 0.8% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors with similar optimism consist of D. E. Shaw’s D E Shaw, Jim Simons’s Renaissance Technologies and Cliff Asness’s AQR Capital Management.