Seabridge Gold, Inc. (SA): Hedge Funds Going Back and Forth

The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st, about a week after the S&P 500 Index bottomed. We at Insider Monkey have made an extensive database of more than 821 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Seabridge Gold, Inc. (NYSE:SA) based on those filings.

Seabridge Gold, Inc. (NYSE:SA) shareholders have witnessed an increase in activity from the world’s largest hedge funds of late. SA was in 7 hedge funds’ portfolios at the end of the first quarter of 2020. There were 6 hedge funds in our database with SA holdings at the end of the previous quarter. Our calculations also showed that SA isn’t among the 30 most popular stocks among hedge funds (click for Q1 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 viewed as slow, old investment vehicles of years past. While there are more than 8000 funds trading at present, Our experts hone in on the upper echelon of this club, about 850 funds. It is estimated that this group of investors manage most of the smart money’s total capital, and by shadowing their highest performing equity investments, Insider Monkey has brought to light a number of investment strategies that have historically outrun the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .

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John Paulson of Paulson & Co

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let’s check out the fresh hedge fund action surrounding Seabridge Gold, Inc. (NYSE:SA).

How have hedgies been trading Seabridge Gold, Inc. (NYSE:SA)?

At the end of the first quarter, a total of 7 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 17% from one quarter earlier. On the other hand, there were a total of 8 hedge funds with a bullish position in SA a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Seabridge Gold, Inc. (NYSE:SA) was held by Weiss Asset Management, which reported holding $10.3 million worth of stock at the end of September. It was followed by Paulson & Co with a $6.5 million position. Other investors bullish on the company included Sprott Asset Management, D E Shaw, and Millennium Management. In terms of the portfolio weights assigned to each position Weiss Asset Management allocated the biggest weight to Seabridge Gold, Inc. (NYSE:SA), around 1.63% of its 13F portfolio. Sprott Asset Management is also relatively very bullish on the stock, dishing out 0.58 percent of its 13F equity portfolio to SA.

As aggregate interest increased, key hedge funds have jumped into Seabridge Gold, Inc. (NYSE:SA) headfirst. PEAK6 Capital Management, managed by Matthew Hulsizer, initiated the most valuable position in Seabridge Gold, Inc. (NYSE:SA). PEAK6 Capital Management had $0.9 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $0.5 million position during the quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Seabridge Gold, Inc. (NYSE:SA) but similarly valued. These stocks are Griffon Corporation (NYSE:GFF), China Online Education Group (NYSE:COE), Malibu Boats Inc (NASDAQ:MBUU), and Meridian Bancorp, Inc. (NASDAQ:EBSB). This group of stocks’ market caps match SA’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
GFF 13 73402 1
COE 4 19972 1
MBUU 16 71820 0
EBSB 12 55305 0
Average 11.25 55125 0.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 11.25 hedge funds with bullish positions and the average amount invested in these stocks was $55 million. That figure was $28 million in SA’s case. Malibu Boats Inc (NASDAQ:MBUU) is the most popular stock in this table. On the other hand China Online Education Group (NYSE:COE) is the least popular one with only 4 bullish hedge fund positions. Seabridge Gold, Inc. (NYSE:SA) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.9% in 2020 through June 10th and still beat the market by 14.2 percentage points. A small number of hedge funds were also right about betting on SA as the stock returned 73.9% during the second quarter and outperformed the market by an even larger margin.

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