Lookback: Tao Value’s 2019 JOYY Inc (YY) Thesis

If you are looking for the best ideas for your portfolio you may want to consider some of Tao Value’s top stock picks. Tao Value, an investment management firm, is bullish on Joyy Inc. (NASDAQ:YY) stock. In its Q3 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on Joyy Inc. (NASDAQ:YY) stock. Joyy Inc. (NASDAQ:YY) operates a global social media platform.

On October 30, 2019, Tao Value had released its Q3 2019 investor letter. The investment firm said that Joyy Inc. (NASDAQ:YY) was one of the biggest detractors to its performance in Q3 2019. The stock has posted a return of 45% in the trailing one year period, outperforming the S&P 500 Index which returned 15.8% in the same period. This suggests that the investment firm was right in its decision.

Tao Value fund posted a return of 1.26% in the third quarter of 2019, underperforming the S&P 500 Index which returned 1.87% in the same quarter. Let’s take a look at comments made by Tao Value about Joyy Inc. (NASDAQ:YY) in the Q3 2019 investor letter.

“YY had another poor stock performance quarter, however its business actually showed some positive growth, particularly in HUYA & Bigo segments. According to the management, the overseas livestreaming & short video expansion will remain as the focus for the foreseeable future. This emphasize implies heavy Sales & Marketing spending will weigh down the margin in near future. I’m comfortable on the live streaming side as they have proved to be the best operator in mainland China, however, will be prepared to monitor closely on their execution on short video front. As many of you are aware of, Douyin (or Tik Tok) is “eating the world” on this playing field. The stock may be “dead money” for some time, as it would appear more “expensive” in quantitative value terms.”

In July 2020, we published an article revealing Tao Value’s bullish investment thesis on Joyy Inc. (NASDAQ:YY) stock in its Q2 2020 investor letter. This suggests that the investment firm has been bullish for a long time on Joyy Inc. (NASDAQ:YY).

In Q2 2020, the number of bullish hedge fund positions on Joyy Inc. (NASDAQ:YY) stock increased by about 87% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in Joyy’s growth potential. Our calculations showed that Joyy Inc. (NASDAQ:YY) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

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Disclosure: None. This article is originally published at Insider Monkey.