Significant Quarterly Increase in Equity Holdings Led by Financials, Energy, and Healthcare; BHP Billiton is Most-Bought Single Stock, Microsoft is Most-Sold
NEW YORK, Nov. 20 2017 — S&P Global Market Intelligence, a leading provider of multi-asset class research data and insights, today released its review of Q3 2017 13F filings by pure play hedge funds. The quarterly S&P Global Market Intelligence Hedge Fund Tracker is an aggregate analysis of hedge fund equity ownership that highlights hedge fund investments in specific stocks and sectors.
The latest Hedge Fund Tracker analysis shows the top funds managed approximately $167 billion in equity holdings, up $13 billion from Q2 2017. The total number of equity positions held also increased to 463 in Q3, up from 423 in Q2, as hedge funds made significant buys in the financials, energy, and healthcare sectors.
“While the macroeconomic and geopolitical tea leaves have been incredibly challenging to read this year, pure play hedge funds seem to agree that there is some upside to be had in the equity markets,” said Pavle Sabic, Head of Market Development, S&P Global Market Intelligence. “Total equity positions and total equity assets under management have increased in the third quarter at a pace we haven’t seen since 2015, suggesting a healthy appetite for stocks in the financials, energy, and healthcare sectors.”
Following is a summary of findings in the Q3 2017 Hedge Fund Tracker:
- Top Funds Go Long Financials, Energy, and Healthcare Stocks: Hedge funds bought $2.2 billion in financials sector stocks, $1.8 billion in energy sector stocks, and $1.7 billion in healthcare sector stocks in Q3. In all, 7 of the 11 sectors of the S&P 500 saw net buying among large hedge funds.
- Big Tech Names See Sell-Off: The two most-sold stocks of the quarter were Microsoft ($1.2 billion) and Symantec Corp. ($944 million).
- Utilities and Telecommunications Sectors Underweight: Hedge funds continue to be underweight in the utilities and telecoms sectors with stocks from those sectors accounting for less than 1% of total portfolio weighting through Q3 2017. The consumer discretionary sector has the highest weighting in hedge fund equity portfolio with 20%.
S&P Global Market Intelligence analyzes the latest quarterly 13F filings* to determine the top ten largest hedge funds based on reported equity assets. Further analysis isolates the universe to pure-play hedge funds that focus on stock picks and hones that universe further to isolate the hedge funds that overweight their biggest investments by capping the number of stocks held at 100. S&P Global Market Intelligence performs this research quarterly in order to understand what the most prominent hedge funds are buying, holding and selling. The firm develops the analysis through an examination of both industry filings as well as Excel-based holding models, allowing clients to quickly spot global trends in asset category and understand what some of the largest investors buying, selling and holding.
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Form 13F Reports are required to be filed within 45 days of the end of a calendar quarter by institutional investment managers with the U.S. Securities and Exchange Commission (SEC). An institutional investment manager is an entity that invests in, buys or sells securities for its own account, or a natural person or entity that exercises investment discretion over the account of any other natural person or entity. Only securities on the 13F list provided quarterly by the SEC (13F Securities) are required to be included in Form 13F Reports. Therefore, Form 13F Reports may not reflect the most current holdings of institutional investment managers because it is required that the 13F Report include only 13F Securities, is filed on a lag, and some funds may not meet the filing thresholds or other requirements. In addition, because the 13F Reports are as of the last date of the quarter, the 13F Report may not describe intra-quarter activity.