Smart Money Brokering Itself More Shares of Interactive Brokers Group, Inc. (IBKR)

The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors endured a turbulent quarter, which propelled them to adjust their equity holdings so as to maintain their desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Interactive Brokers Group, Inc. (NASDAQ:IBKR).

Interactive Brokers Group, Inc. (NASDAQ:IBKR) investors should be aware of an increase in support from the world’s most elite money managers in recent months. Interactive Brokers Group, Inc. was in 37 hedge funds’ portfolios at the end of the third quarter of 2015. There were 34 hedge funds in our database with Interactive Brokers Group, Inc. 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 Skyworks Solutions Inc (NASDAQ:SWKS), EnergySolutions, Inc. (NYSE:ES), and Omnicom Group Inc. (NYSE:OMC) to gather more data points.

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To most shareholders, hedge funds are assumed to be unimportant, old investment tools of years past. While there are over 8,000 funds with their doors open at the moment, our experts choose to focus on the bigwigs of this club, about 700 funds. These hedge fund managers preside over the lion’s share of all hedge funds’ total capital, and by following their matchless stock picks, Insider Monkey has revealed several investment strategies that have historically outpaced the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outperformed the S&P 500 index by 12 percentage points per year for a decade in their back tests.

Now, we’re going to take a peek at the key action regarding Interactive Brokers Group, Inc. (NASDAQ:IBKR).

How have hedgies been trading Interactive Brokers Group, Inc. (NASDAQ:IBKR)?

At Q3’s end, a total of 37 of the hedge funds tracked by Insider Monkey held long positions in this stock, a 9% rise from the second quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their holdings significantly (or had already accumulated large positions).

Of the funds tracked by Insider Monkey, Ted Kang’s Kylin Management has the most valuable position in Interactive Brokers Group, Inc. (NASDAQ:IBKR), worth close to $225.2 million, corresponding to 24% of its total 13F portfolio. The second-largest stake is held by Quincy Lee of Ancient Art (Teton Capital), with a $139.6 million position; 23.7% of its 13F portfolio is allocated to the stock. Other peers that are bullish comprise Gavin M. Abrams’ Abrams Bison Investments, Allan Mecham and Ben Raybould’s Arlington Value Capital, and John Burbank’s Passport Capital.

Now, key hedge funds were leading the bulls’ herd. Arlington Value Capital assembled the most outsized position in Interactive Brokers Group, Inc. (NASDAQ:IBKR). Arlington Value Capital had $75.8 million invested in the company at the end of the quarter. Brian Bares’ Bares Capital Management also made a $36.5 million investment in the stock during the quarter. The other funds with new positions in the stock are Michael Pausic’s Foxhaven Asset Management, Renaissance Technologies, and Andre F. Perold’s HighVista Strategies.

Let’s go over hedge fund activity in other stocks similar to Interactive Brokers Group, Inc. (NASDAQ:IBKR). These stocks are Skyworks Solutions Inc (NASDAQ:SWKS), Eversource Energy (NYSE:ES), Omnicom Group Inc. (NYSE:OMC), and SK Telecom Co., Ltd. (ADR) (NYSE:SKM). All of these stocks’ market caps are similar to Interactive Brokers Group, Inc.’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
SWKS 36 571975 0
ES 13 350832 1
OMC 26 1529637 -4
SKM 7 85505 0

As you can see these stocks had an average of 20.5 hedge funds with bullish positions and the average amount invested in these stocks was $634 million. That figure was $821 million in Interactive Brokers Group, Inc.’s case. Skyworks Solutions Inc (NASDAQ:SWKS) is the most popular stock in this table. On the other hand SK Telecom Co., Ltd. (ADR) (NYSE:SKM) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Interactive Brokers Group, Inc. (NASDAQ:IBKR) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.