Here is What Hedge Funds Think About Lion Group Holding Ltd. (LGHL)
With the first-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the second quarter of 2021. One of these stocks was Lion Group Holding Ltd. (NASDAQ:LGHL).
Lion Group Holding Ltd. (NASDAQ:LGHL) was in 3 hedge funds' portfolios at the end of the first quarter of 2021. The all time high for this statistic is 5. LGHL has seen a decrease in activity from the world's largest hedge funds recently. There were 4 hedge funds in our database with LGHL positions at the end of the fourth quarter. Our calculations also showed that LGHL isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Hedge funds have more than $3.5 trillion in assets under management, so you can't expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 115 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds' moves today.
Bart Baum of Ionic Capital Management
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $28 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. 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. You can subscribe to our free daily newsletter on our homepage. Keeping this in mind let's take a glance at the key hedge fund action surrounding Lion Group Holding Ltd. (NASDAQ:LGHL).
Do Hedge Funds Think LGHL Is A Good Stock To Buy Now?
At the end of March, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -25% from the previous quarter. By comparison, 0 hedge funds held shares or bullish call options in LGHL a year ago. So, let's find 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, Symmetry Peak Management, managed by Frank Slattery, holds the most valuable position in Lion Group Holding Ltd. (NASDAQ:LGHL). Symmetry Peak Management has a $1.4 million position in the stock, comprising 4.7% of its 13F portfolio. Sitting at the No. 2 spot is Ionic Capital Management, led by Bart Baum, holding a $1 million position; 0.1% of its 13F portfolio is allocated to the company. Remaining peers that hold long positions encompass Ken Griffin's Citadel Investment Group, and . In terms of the portfolio weights assigned to each position Symmetry Peak Management allocated the biggest weight to Lion Group Holding Ltd. (NASDAQ:LGHL), around 4.72% of its 13F portfolio. Ionic Capital Management is also relatively very bullish on the stock, designating 0.13 percent of its 13F equity portfolio to LGHL.
Since Lion Group Holding Ltd. (NASDAQ:LGHL) has experienced falling interest from the aggregate hedge fund industry, we can see that there were a few money managers who sold off their full holdings last quarter. It's worth mentioning that Sander Gerber's Hudson Bay Capital Management sold off the largest investment of the "upper crust" of funds monitored by Insider Monkey, totaling about $0 million in stock. Phillip Goldstein, Andrew Dakos and Steven Samuels's fund, Bulldog Investors, also sold off its stock, about $0 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest dropped by 1 funds last quarter.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Lion Group Holding Ltd. (NASDAQ:LGHL) but similarly valued. We will take a look at The Alkaline Water Company Inc. (NASDAQ:WTER), Guaranty Federal Bancshares, Inc. (NASDAQ:GFED), First National Corporation (NASDAQ:FXNC), Amesite Inc. (NASDAQ:AMST), Ranger Energy Services, Inc. (NYSE:RNGR), Richardson Electronics, Ltd. (NASDAQ:RELL), and Lifeway Foods, Inc. (NASDAQ:LWAY). This group of stocks' market caps resemble LGHL's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position WTER,3,423,-1 GFED,2,1543,0 FXNC,2,8689,0 AMST,1,56,1 RNGR,2,1632,0 RELL,4,13355,1 LWAY,4,3065,0 Average,2.6,4109,0.1 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 2.6 hedge funds with bullish positions and the average amount invested in these stocks was $4 million. That figure was $3 million in LGHL's case. Richardson Electronics, Ltd. (NASDAQ:RELL) is the most popular stock in this table. On the other hand Amesite Inc. (NASDAQ:AMST) is the least popular one with only 1 bullish hedge fund positions. Lion Group Holding Ltd. (NASDAQ:LGHL) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for LGHL is 55.3. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.2% in 2021 through June 11th and beat the market again by 3.3 percentage points. Unfortunately LGHL wasn't nearly as popular as these 5 stocks and hedge funds that were betting on LGHL were disappointed as the stock returned -46.2% since the end of March (through 6/11) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.
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