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As Hedge Funds Binge on Health Care, We Serve Up ETFs That Mirror ‘Smart Money’ Strategies

The 8th edition of the Hedge Fund Tracker is out, highlighting the latest quarterly 13F filings of the ten largest hedge funds, managing $202 billion in assets, in which we seek out what stocks and sectors have been most in and out favor. For some this is an opportunity to see what the “smart money” has been buying and selling.

Click here to read the full Hedge Fund Tracker Q1 2015 report.

Here are the key findings:

  • Healthcare Winning, Energy Staying Alive, Info Tech Bringing Up the Rear: Hedge funds flocked to health care stocks in Q1, racking up net buys of $4.8 billion. Industrials followed with $1.5 billion in buying and energy – despite the oil price slump – was the third largest buy with $1.1 billion. Information technology saw the highest volume of selling with $1.2 billion in net sells for the quarter.
  • Valeant – Love it?  Or Hate it? Valeant Pharmaceuticals (TSX:VRX) was the biggest buy for the hedge funds with $3.7 billion in net buys.  It was simultaneously the biggest sell with $1.4 billion in sells. Bill Ackman’s Pershing Square Management was the front runner in the Valeant share buying, with over 19 million shares bought during the quarter. 
  • Actavis in the Spotlight : Hedge fund managers bought Actavis (NYSE:ACT) with impressive conviction in Q1, with 2 out of the 10 hedge funds establishing new positions in the company, helping to make it this quarter’s second  top overall buy ($2.6 billion).
  • Alibaba and Dollar General Among Most Sold Stocks:  The top two sold out positions among hedge fund managers were Alibaba (NYSE:BABA) and Dollar General (NYSE:DG) with $1.1 billion and $900 million in net sales, respectively.

Based on these trends among hedge fund managers Todd Rosenbluth, S&P Capital IQ Director of ETF Research also produced a Trends & Ideas research note that names specific ETFs that are weighted toward the stocks named in the 2015 Q1 Hedge Fund Tracker

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