We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn’t mean that they don’t have occasional colossal losses; they do (like Ackman’s recent Valeant losses). However, it is still good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards Vonage Holdings Corp. (NYSE:VG).
Is Vonage Holdings Corp. (NYSE:VG) a sound investment right now? The stock is one of the best performers of the year and so far returned about 60%. Our calculations show that the smart money doesnt’ think that the stock is overvalued and overall the number of hedge funds with bullish Vonage positions have been increasing. The number of long hedge fund bets improved by 3 during the third quarter. At the end of this article we will also compare VG to other stocks including Cohen & Steers, Inc. (NYSE:CNS), Northwest Natural Gas Co (NYSE:NWN), and Stillwater Mining Company (NYSE:SWC) to get a better sense of its popularity.
Hedge fund activity in Vonage Holdings Corp. (NYSE:VG)
Heading into Q4, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 19% from the second quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes substantially (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Renaissance Technologies, founded by billionaire Jim Simons, holds the most valuable position in Vonage Holdings Corp. (NYSE:VG). Renaissance Technologies has a $63.4 million position in the stock, comprising 0.2% of its 13F portfolio. Coming in second is George McCabe of Portolan Capital Management, with a $11.6 million position; the fund has 1.5% of its 13F portfolio invested in the stock. Remaining members of the smart money that hold long positions include mostly quant hedge funds D. E. Shaw’s D E Shaw, Israel Englander’s Millennium Management and Cliff Asness’s AQR Capital Management.