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"October lived up to its scary reputation—the S&P 500 falling in the month by the largest amount in the last 40 years, the only worse Octobers being '08 and the Crash of '87. For perspective, there have been only 5 occasions in those 40 years when the S&P 500 declined by greater than 20% from peak to trough. Other than the '87 Crash, all were during recessions. There were 17 other instances, over the same time frame, when the market fell by over 10% but less than 20%. Furthermore, this is the 18th correction of 5% or more since the current bull market started in March '09. Corrections are the norm. They can be healthy as they often undo market complacency—overbought levels—potentially allowing the market to base and move even higher." This is how Trapeze Asset Management summarized the recent market moves in its investor letter. We pay attention to what hedge funds are doing in a particular stock before considering a potential investment because it works for us. So let’s take a glance at the smart money sentiment towards one of the stocks hedge funds invest in.
Is EQT Corporation (NYSE:EQT) a bargain? Money managers are turning bullish. The number of long hedge fund positions improved by 5 in recent months.
In today’s marketplace there are a lot of metrics investors employ to grade publicly traded companies. A couple of the less known metrics are hedge fund and insider trading interest. We have shown that, historically, those who follow the top picks of the elite investment managers can beat the S&P 500 by a healthy margin (see the details here).
Let's go over the new hedge fund action regarding EQT Corporation (NYSE:EQT).
How have hedgies been trading EQT Corporation (NYSE:EQT)?
Heading into the fourth quarter of 2018, a total of 45 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 13% from the previous quarter. On the other hand, there were a total of 50 hedge funds with a bullish position in EQT at the beginning of this year. With hedge funds' positions undergoing their usual ebb and flow, there exists an "upper tier" of key hedge fund managers who were boosting their stakes substantially (or already accumulated large positions).
Among these funds, Kensico Capital held the most valuable stake in EQT Corporation (NYSE:EQT), which was worth $421.3 million at the end of the third quarter. On the second spot was D E Shaw which amassed $403.9 million worth of shares. Moreover, Canyon Capital Advisors, Highfields Capital Management, and Iridian Asset Management were also bullish on EQT Corporation (NYSE:EQT), allocating a large percentage of their portfolios to this stock.