By: Spencer Israel
The coronavirus-induced market volatility began in earnest on Feb. 24, which gave hedge fund managers five weeks to adjust their portfolios before the end of the quarter.
With regulatory 13F filings due last Friday, we finally know what they did.
A Lot Of Selling
According to data from WhaleWisdom, assets under management by 13F filers (investors with at least $100 million in AUM) fell by 23% during the first quarter, to $24.1 trillion from $34.1 trillion at the end of 2019. That was the biggest quarterly decline in AUM since Q4 2008.
Last week’s filings also revealed 274 more net sellers of stocks than net buyers during the first quarter. That’s a stunning reversal from the prior quarter, during which there were 567 more net buyers than sellers. It also marks the greatest amount of net sellers among 13F filers since Q3 2016.
Stocks That Were Most Bought
Perhaps unsurprisingly, Amazon ($AMZN) was the most bought stock among all 13F filers last quarter. Overall, there more than twice as many buys/increased stakes (1,961) as sells/reduced stakes (934).
Linde ($LIN) was the most popular new stake last quarter, with 912 hedge funds initiating a position in the company.
Vertiv Holdings ($VRT) saw the greatest increase in hedge fund activity last quarter. The electrical equipment company was mentioned in 100 13F filings—98 of which were new positions—according to WhaleWisdom, after garnering just one mention in Q4 2019.
The most loved stock was arguably Change Healthcare ($CHNG). The healthcare technology company was mentioned in 220 filings, with 94% of those mentions corresponding to a new buy or increased position.
Stocks That Were Most Sold
Apple ($AAPL) was the stock with the greatest number of reduced positions among hedge funds last quarter, with 1,756 hedge funds lowering their stake. But Boeing ($BA) was arguably the most hated stock.
According to WhaleWisdom, 494 hedge funds exited out of their Boeing positions entirely last quarter, more than any other company (though 128 funds did initiate new positions). Just behind Boeing were Raytheon Technologies ($RTX) (449 hedge funds closed positions) and ConocoPhillips ($COP) (394).
Diverging Views On Big Names
Big tech was largely bought by hedge funds during the quarter, but there were a number of high-profile investors on both sides of the trade.
Facebook ($FB), for example, was bought last quarter by Leon Cooperman’s Omega Advisors, Seth Klarman’s Baupost Group, and Cliff Asness’ AQR Capital Management.
On the other side, David Tepper’s Appaloosa Management, Jim Simons’ Renaissance Technologies, and Ken Griffin’s Citadel were among the funds that dramatically cut their positions in the company.
Klarman also initiated a new position in Alphabet ($GOOGL), while Tepper, Cooperman, and George Soros all reduced their holdings.
The same can be said for the banks.
Warren Buffett’s Berkshire Hathaway reduced its stake in Goldman Sachs ($GS), while David Einhorn’s Greenlight Capital increased its stake. Buffett and Soros also reduced their stakes in JP Morgan ($JPM), while Cooperman added to his position.
Buffett notably did not reduce his positions in Bank of America ($BAC) or Wells Fargo ($WFC), while Soros sold the former and Cooperman sold the latter.
The author owns Alphabet, Amazon, Bank of America, Boeing, ConocoPhillips, Goldman Sachs, Facebook, JP Morgan, Linde, Raytheon Technologies, and Wells Fargo in his 401(k).
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