Are Hedge Funds Proper About This Inventory?

The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the first quarter, which unveil their equity positions as of March 31st. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Fuel Tech Inc. (NASDAQ:FTEK).

Fuel Tech Inc. (NASDAQ:FTEK) was in 4 hedge funds’ portfolios at the end of March. The all time high for this statistic is 5. FTEK has experienced an increase in activity from the world’s largest hedge funds recently. There were 3 hedge funds in our database with FTEK holdings at the end of December. Our calculations also showed that FTEK isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

According to most traders, hedge funds are assumed to be worthless, outdated investment tools of the past. While there are over 8000 funds with their doors open at the moment, Our researchers look at the top tier of this group, about 850 funds. Most estimates calculate that this group of people watch over the lion’s share of the smart money’s total asset base, and by paying attention to their matchless stock picks, Insider Monkey has brought to light a number of investment strategies that have historically defeated the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy surpassed the S&P 500 short ETFs by around 20 percentage points a year since its inception in March 2017. Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .

Billionaire Ken Griffin's Top 10 Stocks Holdings

Billionaire Ken Griffin’s Top 10 Stocks Holdings

Ken Griffin of Citadel Investment Group

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation, which is why we are checking out this inflation play. We go through lists like 10 best gold stocks to buy to identify promising stocks. 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. With all of this in mind let’s check out the recent hedge fund action regarding Fuel Tech Inc. (NASDAQ:FTEK).

Do Hedge Funds Think FTEK Is A Good Stock To Buy Now?

At the end of March, a total of 4 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 33% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards FTEK over the last 23 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

According to Insider Monkey’s hedge fund database, Renaissance Technologies, holds the biggest position in Fuel Tech Inc. (NASDAQ:FTEK). Renaissance Technologies has a $4.1 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Alyeska Investment Group, managed by Anand Parekh, which holds a $2.7 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other hedge funds and institutional investors that are bullish contain Steven Boyd’s Armistice Capital, and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Armistice Capital allocated the biggest weight to Fuel Tech Inc. (NASDAQ:FTEK), around 0.06% of its 13F portfolio. Alyeska Investment Group is also relatively very bullish on the stock, setting aside 0.04 percent of its 13F equity portfolio to FTEK.

As one would reasonably expect, specific money managers have jumped into Fuel Tech Inc. (NASDAQ:FTEK) headfirst. Alyeska Investment Group, managed by Anand Parekh, initiated the biggest position in Fuel Tech Inc. (NASDAQ:FTEK). Alyeska Investment Group had $2.7 million invested in the company at the end of the quarter. Steven Boyd’s Armistice Capital also made a $2.7 million investment in the stock during the quarter.

Let’s now review hedge fund activity in other stocks similar to Fuel Tech Inc. (NASDAQ:FTEK). These stocks are Cyclerion Therapeutics, Inc. (NASDAQ:CYCN), Coda Octopus Group, Inc. (NASDAQ:CODA), Taoping Inc. (NASDAQ:TAOP), J. Jill, Inc. (NYSE:JILL), Diffusion Pharmaceuticals Inc. (NASDAQ:DFFN), Core Molding Technologies, Inc. (NYSE:CMT), and Sino-Global Shipping America, Ltd. (NASDAQ:SINO). This group of stocks’ market values are closest to FTEK’s market value.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CYCN,9,30854,1 CODA,2,858,2 TAOP,1,214,-1 JILL,4,10738,2 DFFN,3,2026,0 CMT,3,17252,-1 SINO,1,169,1 Average,3.3,8873,0.6 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 3.3 hedge funds with bullish positions and the average amount invested in these stocks was $9 million. That figure was $10 million in FTEK’s case. Cyclerion Therapeutics, Inc. (NASDAQ:CYCN) is the most popular stock in this table. On the other hand Taoping Inc. (NASDAQ:TAOP) is the least popular one with only 1 bullish hedge fund positions. Fuel Tech Inc. (NASDAQ:FTEK) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for FTEK is 48.8. 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 FTEK wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on FTEK were disappointed as the stock returned -21% 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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