The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 823 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of June 30th, when the S&P 500 Index was trading around the 3100 level. Stocks kept going up since then. In this article we look at how hedge funds traded Barrick Gold Corporation (NYSE:GOLD) and determine whether the smart money was really smart about this stock.
Is Barrick Gold Corporation (NYSE:GOLD) a buy, sell, or hold? Prominent investors were turning less bullish. The number of bullish hedge fund bets retreated by 2 recently. Barrick Gold Corporation (NYSE:GOLD) was in 52 hedge funds' portfolios at the end of the second quarter of 2020. The all time high for this statistics is 54. Our calculations also showed that GOLD isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks). There were 54 hedge funds in our database with GOLD positions at the end of the first quarter.
Video: Watch our video about the top 5 most popular hedge fund stocks.
To most shareholders, hedge funds are assumed to be slow, old investment vehicles of years past. While there are more than 8000 funds trading at the moment, Our researchers look at the masters of this group, approximately 850 funds. These investment experts orchestrate the lion's share of the hedge fund industry's total capital, and by following their first-class stock picks, Insider Monkey has brought to light a number of investment strategies that have historically exceeded Mr. Market. Insider Monkey's flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points a year since its inception in March 2017. Our portfolio of short stocks lost 34% since February 2017 (through August 17th) even though the market was up 53% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
Peter Rathjens Arrowstreet Capital 394
Peter Rathjens of Arrowstreet Capital
At Insider Monkey we scour multiple sources to uncover the next great investment idea. Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost precious metals prices. So, we are checking out this junior gold mining stock.. We go through lists like the 10 most profitable companies in America to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. With all of this in mind let's take a look at the fresh hedge fund action encompassing Barrick Gold Corporation (NYSE:GOLD).
Hedge fund activity in Barrick Gold Corporation (NYSE:GOLD)
At Q2's end, a total of 52 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -4% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards GOLD over the last 20 quarters. With hedge funds' sentiment swirling, there exists a few notable hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Barrick Gold Corporation (NYSE:GOLD), which was worth $722.2 million at the end of the third quarter. On the second spot was Berkshire Hathaway which amassed $563.6 million worth of shares. GQG Partners, Arrowstreet Capital, and Slate Path Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Oldfield Partners allocated the biggest weight to Barrick Gold Corporation (NYSE:GOLD), around 16.63% of its 13F portfolio. Odey Asset Management Group is also relatively very bullish on the stock, earmarking 11.82 percent of its 13F equity portfolio to GOLD.
Seeing as Barrick Gold Corporation (NYSE:GOLD) has faced a decline in interest from the smart money, it's easy to see that there lies a certain "tier" of money managers who sold off their positions entirely heading into Q3. Intriguingly, Brad Dunkley and Blair Levinsky's Waratah Capital Advisors dropped the largest stake of the "upper crust" of funds watched by Insider Monkey, totaling about $42.1 million in stock. Richard Driehaus's fund, Driehaus Capital, also sold off its stock, about $17.1 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 2 funds heading into Q3.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Barrick Gold Corporation (NYSE:GOLD) but similarly valued. These stocks are Equinor ASA (NYSE:EQNR), Lam Research Corporation (NASDAQ:LRCX), The Progressive Corporation (NYSE:PGR), Square, Inc. (NYSE:SQ), Relx PLC (NYSE:RELX), Analog Devices, Inc. (NASDAQ:ADI), and Westpac Banking Corporation (NYSE:WBK). This group of stocks' market valuations match GOLD's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position EQNR,10,237155,-1 LRCX,62,2537918,8 PGR,50,1147531,-1 SQ,66,3487480,10 RELX,6,118963,1 ADI,49,2849471,4 WBK,4,28400,-5 Average,35.3,1486703,2.3 [/table]
As you can see these stocks had an average of 35.3 hedge funds with bullish positions and the average amount invested in these stocks was $1487 million. That figure was $3361 million in GOLD's case. Square, Inc. (NYSE:SQ) is the most popular stock in this table. On the other hand Westpac Banking Corporation (NYSE:WBK) is the least popular one with only 4 bullish hedge fund positions. Barrick Gold Corporation (NYSE:GOLD) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for GOLD is 70.6. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. 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 33% in 2020 through the end of August and beat the market by 23.2 percentage points. Unfortunately GOLD wasn't nearly as popular as these 10 stocks and hedge funds that were betting on GOLD were disappointed as the stock returned 10.4% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
