Hedge fund managers like David Einhorn, Dan Loeb, or Carl Icahn became billionaires through reaping large profits for their investors, which is why piggybacking their stock picks may provide us with significant returns as well. Many hedge funds, like Paul Singer’s Elliott Management, are pretty secretive, but we can still get some insights by analyzing their quarterly 13F filings. One of the most fertile grounds for large abnormal returns is hedge funds’ most popular small-cap picks, which are not so widely followed and often trade at a discount to their intrinsic value. In this article we will check out hedge fund activity in another small-cap stock: ChannelAdvisor Corp (NYSE:ECOM).
ChannelAdvisor Corp (NYSE:ECOM) shareholders have witnessed an increase in hedge fund interest last quarter. There were 10 hedge funds in our database with ECOM positions at the end of September. 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 Pacific Continental Corporation (NASDAQ:PCBK), Aratana Therapeutics Inc (NASDAQ:PETX), and United Community Financial Corp (NASDAQ:UCFC) 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.
With all of this in mind, let’s view the latest action surrounding ChannelAdvisor Corp (NYSE:ECOM).
Hedge fund activity in ChannelAdvisor Corp (NYSE:ECOM)
At Q3’s end, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, up by 11% from the previous quarter. On the other hand, there were a total of 10 hedge funds with a bullish position in ECOM at the beginning of this year. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, D E Shaw, one of the biggest hedge funds in the world, holds the biggest position in ChannelAdvisor Corp (NYSE:ECOM). D E Shaw has a $6.3 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Israel Englander’s Millennium Management, with a $2.2 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Remaining hedge funds and institutional investors that are bullish contain Jim Simons’ Renaissance Technologies, Josh Goldberg’s G2 Investment Partners Management, and John Overdeck and David Siegel’s Two Sigma Advisors. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.