Amid an overall market correction, many stocks that smart money investors were collectively bullish on tanked during the fourth quarter. Among them, Amazon and Netflix ranked among the top 30 picks and both lost more than 25%. Facebook, which was the second most popular stock, lost 20% amid uncertainty regarding the interest rates and tech valuations. Nevertheless, our research shows that most of the stocks that smart money likes historically generate strong risk-adjusted returns. That's why we weren't surprised when hedge funds’ top 15 large-cap stock picks generated a return of 19.7% during the first 2.5 months of 2019 and outperformed the broader market benchmark by 6.6 percentage points.This is why following the smart money sentiment is a useful tool at identifying the next stock to invest in.

Is Oasis Petroleum Inc. (NYSE:OAS) ready to rally soon? Hedge funds are taking a pessimistic view. The number of long hedge fund bets retreated by 2 recently. Our calculations also showed that OAS isn't among the 30 most popular stocks among hedge funds.

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Let's check out the fresh hedge fund action surrounding Oasis Petroleum Inc. (NYSE:OAS).

How are hedge funds trading Oasis Petroleum Inc. (NYSE:OAS)?

Heading into the first quarter of 2019, a total of 31 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -6% from one quarter earlier. On the other hand, there were a total of 26 hedge funds with a bullish position in OAS a year ago. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Oasis Petroleum Inc. (NYSE:OAS) was held by Millennium Management, which reported holding $78.4 million worth of stock at the end of December. It was followed by Citadel Investment Group with a $61 million position. Other investors bullish on the company included GMT Capital, Alyeska Investment Group, and Perella Weinberg Partners.