Early Market Moves Based on 13F Reports

Hedge funds and other large asset managers filed their SEC required Form 13Fs today. A 13F report is a regulatory report required of all institutional money managers with at least $100 million in assets under management and is published quarterly. The report is the public disclosure of the manager’s holdings and trades conducted during the quarter and is generally reported within 45 days of quarter close.

Investors may use 13F reports to adjust their portfolios to align with the moves made by what is generally considered the “smart money” in the market. Investors can also replicate the investment strategies employed by famed traders and investors based on the data provided in these reports.

It should be noted, however, that the report is usually dated because of the 45–135-day lag period between when trades are conducted and reported. Moreover, the 13F also does not require asset managers to disclose their short positions that may be offsetting long positions. Furthermore, blindly basing investment decisions purely on 13F reports can cause the phenomenon of herding, where investors follow other investors in an irrational way into investments that may not suit their own objectives and risk-tolerances.

Here are some of the preliminary highlights from 2022’s first quarter 13F reports:

• Netflix – Hedge fund giants Pershing Square, Tiger Global, D1 and Viking exited their stakes in Netflix, while Maverick reduced its position by over 100 thousand shares. Meanwhile Coatue was one of the few managers adding to its Netflix position, holding 1.4 million shares as of quarter end.
  
• Carvana – Tiger Global and Maverick also moved in tandem on Carvana, adding positions in the beleaguered company as its stock has dropped 83% year-to-date. Maverick’s flagship hedge fund is down over 33% for the year, mainly due to its position in Carvana. Meanwhile, D1 exited its position in the car retailer during the month.
  
• Shopify – D1 also sold out of its position in Shopify. The hedge fund was in major tech selling mode, also selling off its positions in JD.com, Toast and Tesla. Coatue also sold out of Shopify, but Tiger Global added to its position during the quarter.

We will have more commentary and analysis on hedge-fund moves as more 13F reports are filed and analyzed in the coming days.

This content is provided for general information purposes only and is not to be taken as investment advice nor as a recommendation for any security, investment strategy or investment account.