$MCD's HedgeMind Infographic is Worth a thousand Words

What more do we need to say? Shall we say that's called "smart money move"? We expect them do so correctly, be right, be not too greedy, and took half of profits off the table. They did just that. 

Hedge Fund Trade Spotlight: $MNK

$MNK has suffered sharp decline since last July's dramatic crash, it lost 50%+ in a year. But since then it has been stabilized around $60 (See stock chart).

Has $MNK turned corner yet? Nobody can really know with stock market. If you or I know, then I wouldn't be writing this post.smile emoticonIn fact even the smartest investors like billionaire hedge fund managers, John Paulson, Phil Gross, both holders of $MNK, would dare to say they knew today. But it doesn't prevent us from doing some analysis of hedge funds trading behaviors of this stock.

There are positive signs emerging from the latest 13F filings of hedge funds. For those who are not familiar with what it is 13F, in one sentence, it is a SEC filing requirement for all institutional investors with $100 mln Asset Under Management to disclose their US equity assets at the end of each quarter. Note it is for their long position only and it should be done 45 days after the end of quarter.

What are positive signs we saw in Q1 filings by the hedge funds? Overall they seemed to like it by adding more shares. 8 of Top 10 holders all increased their stakes or initiated new stakes. (see HM infographic). While hedge funds sentiment reading is just neutral, it doesn't take away the strong bullish sentiment among the top holders who seem to be more confident than the bears. Even more notable buyer is Arthur Cohen of Healtcor, a healthcare focused tiger cub, who raised his stake by 690% to now significant 1.72mln sh from initial 249k in Q4. $MNK is now a top 10 holding of Cohen's $1.76bln portfolio and has 6% portfolio weight.

As of end of Q1, HedgeMind Hedge Funds owns 15.87% total shares outstanding while all institutional investors total 95.09%.

For anyone who is interested in $MNK, long or short or just watching, these signs are worth to take notice. 

IMPORTANT: Note this post is neither fundamental or technical analysis of $MNK. It is an analysis of hedge fund holdings.

Welcome to the New HedgeMind.com!

We have redesigned the site for investors to find stock ideas quickly and easily. New Home Page shows you the core features of HedgeMind. Our new navigation menu provides you easy access to HM's most powerful features and stock screeners. 

Validate Your Stock Idea

The most powerful stock search built with you in mind. All you need to do just entering a stock in your mind to see who among top hedge funds also like the same stock.

Stock Ideas:

Identifies potential winning stock picks from top performing hedge funds based on HedgeMind's rigorous research and proprietary indicators. It's designed to help investors get actionable investing ideas quickly and easily. Here are lists of Stock Ideas currently published:
Hedge Fund Trade Spotlight
High Conviction IPO Stocks
50 Stocks Matter Most

Invest Like a Hedge Fund

To invest like a hedge fund, one needs to find the right hedge fund manager to follow first. With 400+ outstanding hedge fund managers to choose from in HedgeMind, we have made it easy for you to find your perfect match with following 3 simple ways:

Find Your Match - enter 5-10 stock symbols
30 Must-Follow - they are the best HedgeMind recommends.
Notable Investor Groups - These are already most successful investors in the world.

There are many more updated features and content. Hope you find that one winning stock quickly!

How to find your perfect smart money manager to follow?

Following smart money requires you to find one or a few right ones who fits your investment style and stock interest. Not only you know them well as a hedge fund manager, but you need really to trust their stock picks that will meet your taste. Only then following the smart money will enhance your probability of winning in stock market as an investor, no matter you are a money manager or individual DIY investor.

HedgeMind recently introduced a tool designed to make it easy to find your ideal hedge fund managers to follow. Let me show how:

Go to "Find the Right Hedge Fund Manager to Follow" page athttps://hedgemind.com/hedge-fund-managers/All

You will see options available for you to use. The easiest way is to just enter 5-10 stocks in your portfolio or stock watchlist in "Find Your Match" search box.
For example, HM likes popular "FANG" stocks: FB AMZN NFLX GOOG + TSLA AAPL. After entering these 6 stocks, "Find You Match" shows who among the top hedge fund managers are currently holding most of them. You may or may not know them yet. But you know now they are the ones who may have the same stock interest as you are. Your next step is to learn about each of them and then figure out who is your best match.

Option 2, "30 Must Follow" gives you a choice of 30 top performing hedge fund managers. They are top hedge funds ranked by Forbes or Bloomberg every year. If you are a growth investor with biotech focus, then you may find the names in "Biotech Must Follow" most interesting to you. If your investing style is value, then you can find legendary value investors, Warren Buffett, Seth Klarman, Leon Cooperman to be your best choices.

Option 3 makes your choice even wider. It is up to you to find out who will be your hedge funds out of many billionaires, tiger cubs, or shareholder activists.

Finding a smart money to follow has never been easier. Now find yours now at https://hedgemind.com

AGN lost its shine today

Allergan, the most popular stock among hedge funds on hedgemind.com, suffered a 15% loss after Secretary Lew 's announcement on tax inversions. It is now one more example of overcrowded stock that are doing serious damaging to hedge funds' money making skills after SUNE & VRX have already done so.

Nearly 28% of hedge funds, many of "who is who" of smart money, have a stake as of 12/31/15. Among them 13 hedge funds only just got in during Q4 2015 and bought it as a top 10 holding in their portfolio (see picture). Early buyers before 2015 may still have gains left even after today's big loss or 30% loss since last summer if they exit today. But for many unlucky ones who bought it during 2015 and still holding it, a loss is in the card, just how much they can stop.

Billionaire Andreas Halvorsen & John Paulson have been the top holders, each w/ 5+ mln shares held as of Q4 2015. They both sold 18%+ of their stakes during Q4 2015. But still their holding are significant should they still hold it as of today, the loss is YTD already 25%, ~$380+ mln. But more damages is really to smaller hedge funds w/ concentrated bet like tiger seed Nehal Chopra who were holding 27% her portfolio in this stock alone.

"Cut your losses short" is probably the time for hedge funds to apply this rule of thumb now.

What could we learn from this? When it is too crowded on one side, something will go wrong eventually. Don't overstay your welcome even when time is really good.

Who are the top hedge fund managers you can follow?

Happy New Year to all HM users and followers! We are going to suggest a few "Must Follow" hedge fund managers if you have found yours yet.

Who to follow is probably a tough decision to make. So many top investors but not everyone fits your investment style or sector interest. Each of us is unique in our own way in selecting stocks, growth or value, tech or biotech, large or small cap, under $10 or $100+... So the most value you can get from following smart money are the ones you can understand, trust, & meet your needs and taste of stocks.

Finding a manager truly yours to follow is a very individual task, no one size fits all. Though HM made it easy to do so, still a lot to do. HedgeMind's Notable Managers groups are a good place to start your search: 
https://hedgemind.com/hedge-fund-managers/All

But we have done the research and believe these HM's Top 5 "Must Follow" investors that are worth for investors to follow and learn. 

HedgeMind's Top 5 "Must Follow" Investors:

Healthcare/Biotech 1. Julian Baker 2. Kevin Kotler 3. Joseph Edelman 4. William Edwards 5. Chris James

Technology: 1. Philippe Laffont 2. Chase Coleman 3. Frank Sands 4. Chris Lord 5. Dan Benton

Growth Investors: 1. Julian Robertson 2. Stanley Druckenmiller 3. Stephen Mandel 4. Lei Zhang 5. Andreas Halvorsen

Value Investors: 1. Seth Klarman 2. Jeffrey Ubben 3. Leon Cooperman 4. David Abrams 5. Warren Buffett

Activist Investors: 1. Carl Icahn 2. Dan Loeb 3. Jeffrey Smith 4. William Ackman 5. Barry Rosenstein

Top Performing Investors: 1. David Tepper 2. Larry Robbins 3. John Paulosn 4. John Burbank 5. Alex Klabin

These are just some of our suggestion. In the end it is up to you to find your most favorite smart money managers to follow.

$MCK A Winning Trade of Billionaire Investor Leon Cooperman

Billionaire Leon Cooperman is a well-known value investor. His portfolio holdings are full of value stock ideas that are great for value investors to study. Remember these stocks were well researched by Cooperman's well paid research analysts. They are top stock picks that Cooperman is willing to bet with his money on.

$MCK is one such winning bet that produced at least $60/sh gains for Cooperman. He bought it initially at max $126/sh in 2013Q2 and recently exited at minimum $186/sh in 2015Q3.

How can individual investors catch a stock winner like $MCK with the knowledge of Leon Cooperman was buying? HedgeMind may help. HedgeMind.com made it very easy for for investors to follow smart money, especially top performing hedge fund managers like Leon Cooperman, David Tepper, George Soros and gain great insights into what they are buying and selling each quart.

Two hedgemind indicators, HM Sentiment & % Funds Owing Stock, are especially useful for investors to study with each their own stocks. Both indicators are derived from hedge fund holdings data and represent the collective trading activities of hedge fund managers in a quarter. They are correlating positively with stock price, most of the time a slightly earlier than stock price move.

Higher bullish hedge funds sentiment on a stock indicates more hedge fund buyings. Rising % funds holders tell us more new hedge fund managers are accumulating the stock, also bullish.

Let's take a look at $MCK's price chart and HedgeMind infographic shown below and pay particular attention to the two indicators, HedgeMind Sentiment & % Funds Owning MCK.

Hedge funds sentiment were highest in 2013 and early 2014 when $MCK was at onset of 2-year rally. % Funds holders also rose during the same early period. By middle 2014, hedge fund investors began to cash out as indicated by hedgemind sentiment and % Funds holders while $MCK continued to rise.Both Hedge funds sentiment & % Funds holders reached low at 2015Q1, a quarter ahead of stock peaked in 2015Q2.

Hope investors learn a thing or 2 from this analysis and improve your winning chance and beat the "loser's game".

Visit hedgemind.com for more stock ideas like $MCK

Tiger Legend Julian Robertson and his famous Tiger Cubs

Julian Robertson is legendary in many ways, investing, mentoring. Mark Yusko, founder & CIO of Morgan Creek Capital Management; wrote "Julian’s investment acumen was so highly regarded, he became known as the 'Wizard of Wall Street,' hence the Wizard of Oz reference in the title of the letter." in his Q1 2015 Market Review & Outlook, a worth read for investors and traders.

"Today, there are close to 100 hedge funds around the world with Tiger DNA", counted by Mark Yusko. 40+ of these tiger cubs and tiger seeds are tracked by hedgeMind for their stock picks and trading activities.

Many Julian Robertson's tiger cubs are billionaire hedge fund managers: Andreas Halvorsen, Stephen Mandel, Chase Coleman, Philippe Laffont, Robert Citrone, Lee Ainslie. They together manage hundreds of billions and produce impressive returns.

The best way to follow them is to learn about their investment style, stock picks, and portfolio management. Like big tiger Julian Robertson, like tiger cubs, they invest in growth stocks, holding less than 40 stocks no matter how big portfolios, placing 50% or more weight in only top 10 stocks, concentrated bets.

Julian Robertson's portfolio is a typical tiger hedgies portfolios (see infographic).

By analyzing his portfolio composition, quarterly stock buys and sales, one can gain great insights from his stock picks, sector allocations, position sizing as well as overall portfolio management. Each new stock buy of his is worth us to pay attention since he has many top talented stock analysts who help him to find the next big FB or AAPL. Why not leverage their hard and better work to build an winning edge?

Follow the Smart Money: Why, How, Who

"Follow the Smart Money" is never about the buzz words that stock market pundits and CNBC news anchors frequently uttered in their daily stock commentaries or news hype. It is about learning from the best and increasing your own winning chances.

What is the term "The Smart Money"? 

Cambridge Dictionaries Online defined "The Smart Money" as 

"money that is ​invested by ​experienced ​investors who ​know a lot about what they are doing." 

At HedgeMind, we defined "The Smart Money" as these ledgendary investors/traders: Warren Buffett, George Soros, Julian Robertson, Stanley Druckenmiller, Carl Icahn, David Tepper, Chase Coleman, Lei Zhang, Seth Klarman, Steve Cohen... who already became self-made billionaires through investing. 

We also consider many young, rising star hedge fund managers as the smart money and worth active individual investors and traders to learn and follow. We will introduce them on this HedgeMind page. 

We will use winning stock examples uncovered on the hedgemind.com to illustrate how the smart money produced winners and avoided losses. Hopefully we all will become a better and smarter investors. 

How to use HedgeMind Sentiment Indicator to Find Winning Stock Ideas

What is HedgeMind Sentiment? 

The HedgeMind Sentiment measures the percentage of hedge fund managers who expressed bullish (buying), bearish (selling), and neutral views on the stock. It is calculated on quarterly basis. 

What is the purpose of HedgeMind Sentiment? 

Wall Street has a saying "Following the smart money".  HedgeMind Sentiment is generated just for that purpose to make it easy for investors and traders to follow smart money.

Correlations of HM sentiment with stock prices. 

Lets use FB as an example to illustrate this correlation of hedge funds sentiment with its stock price for the past two years.

Chart below shows FB's sentiment history from 2013Q3 to 2015Q3: 

FB HedgeMind Sentiment as of 2015-09-30

FB's HM sentiment infographic has three critical quarters where hedge funds showed very either bullish or bearish sentiment. The most notable one is FB enjoyed strong bullish buyings, recorded 80% bullish sentiment in 2013Q3. Then bullish hedgies sentiment declined and turned to bearish, 61% in 2014Q1. More recently FB's hedgies sentiment became bullish again and had a 55% bullish sentiment in 2015Q2. 

What's the FB's stock price after these 3 key quarters? Let's analyze HM sentiment in FB stock chart. 

FB Stock chart with its HM Sentiment

Note HM sentiment is calculated 45 days later after each quarter when hedge funds complete their #13F filings. So we can assume the earliest date when an investor possibly can react to the sentiment data will be 45 days later after each quarter when its sentiment data is published. 

Followed FB's 80% bullish sentiment in 2013Q3, its stock price gained 40% in 3 months, 57% in 12 months, 120% in 24 months from 2013-11-15. A very positive correlation is observed here. 

Will FB enjoy positive return again after FB had a 55% bullish hedgies sentiment again in 2105Q3? Most probably in the next 3-6 months. So far $FB gained 20% since Oct 1, 2015 to today, Nov 21, 2015. We will follow up later. 

More analysis is clearly required to prove whether the HM sentiment can consistently and systematically show strong positive correlation with a stock price. At least our early analysis seems to be very encouraging.