Hedge Funds Retreat from U.S. Stocks

Hedge Funds Shed Equity Holdings in Q3 S&P Capital IQ® Quarterly Hedge Fund Tracker  

Amazon Sees Heaviest Volume of New Buying Among Large Funds

As a complement to the quarterly report, S&P Capital IQ also produced a Trends & Ideas research note which calls out ETFs that give investors exposure to hedge fund buying and selling trends. Read on for more details

Overall Commentary & Findings

S&P Capital IQ Hedge Fund Tracker Q3 2015

  • Hedge Funds Shed Equity Holdings: The top 10 hedge funds had aggregate equity holdings totaling $191 billion in Q3, down from approximately $200 billion in Q2, reflecting a combination of declining value of current positions and an overall decline in total equity holdings from 471 stocks in Q2 to 441 stocks in Q3.
  • Amazon is Top Buy: Amazon was the most-bought single stock among top hedge funds for the first time, with a total of $2.6 billion in new hedge fund investment this quarter.
  • Consumer Staples Drive Buying Activity: Hedge funds favored the non-cyclical, consumer staples sector in Q3, driving a total of $3.7 billion in aggregate buying. The consumer discretionary sector was the best-performing sector in the S&P 500 for the last 12 months though only 5th top buy for the hedge funds.
  • Infotech Sell-Off: The information technology sector saw the highest amount of selling among hedge funds with a total sell-off of $1.4 billion in Q3. This was the third consecutive quarter that information technology led hedge fund selling, with eBay earning the distinction of most-sold single stock.
  • Notable New Positions Taken in Teva and PayPal: Teva Pharmaceuticals and PayPal saw notable new positions taken by large funds, with four funds collectively taking a $1.9 billion stake in Teva Pharmaceuticals and one fund, Icahn Capital, taking a new $1.6 billion position in PayPal. Significant exits were made in Priceline Group, Microsoft and MasterCard.

Top 5 Bought Stocks

  1. Amazon – $2.6 billion, 5.1 million shares, with three funds buying Lone Pine (new position of 1.9 million shares worth $977), Viking Global (735k shares worth $371 million) and Tiger Global ($1.2 billion, 2.4 million shares)
  2. Teva Pharmaceuticals - $1.9 billion with 30 million shares. Paulson & Co bought the majority with 16 million shares worth $1 billion, Viking Global, Highfields Capital  and Glenview Capital also bought the stock
  3. Mondelez International – $1.9 billion, 43 million shares, by Pershing Square Capital, (new position)
  4. PayPal - $1.8 billion, 50 million shares. Icahn made a new position in the stock buying 46 million shares worth $1.7 billion. Highfields Capital also made a new position buying 4.5 million shares worth $164 million
  5. Rolls Royce Holdings - $1.2 billion, 100 million shares, ValueAct Capital made new position

 Top 5 Sold Stocks

  1. eBay - Icahn Capital sold all 47 million shares worth $1.6 billion position of the stock. Glenview Capital made up small percentage of that  
  2. The Priceline Group - $1.2 billion, 984 thousand shares. Tiger Global sold out completely $903 million. Lone Pine decreased position by 200 thousand shares worth $248 million, as did Glenview Capital by 56 thousand shares worth $71 million
  3. Illumina Inc - $1.1 billion, 5.3 million shares. Viking Global selling $661 million (3.2 million shares) and Lone Pine $430 (2.1 million shares)
  4. Microsoft Corp - $987 million, 20 million shares, ValueAct 17million shares worth $931 million and Lone Pine $57 million
  5. MasterCard Incorporated - 8.8 million shares worth $828 million. $436 million, 4.6 million shares, Tiger Global. And $262 million, 2.8 million shares, Viking Global. Lone Pine $129 million

Based on these trends among hedge fund managers, S&P Capital IQ’s Todd Rosenbluth also produced a Trends & Ideas research note which names specific ETFs that are weighted toward the stocks named in the 2015 Q3 Hedge Fund Tracker.  The note also spotlights significant hedge fund outflows in two emerging market ETFs, the Vanguard Emerging Markets (VWO) and iShares MSCI Emerging Markets (EEM) during the quarter.


Form 13F Reports are required to be filed within 45 days of the end of a calendar quarter by institutional investment managers with the U.S. Securities and Exchange Commission (SEC).  An institutional investment manager is an entity that  invests in, buys or sells securities for its own account, or a natural person or entity that exercises investment discretion over the account of any other natural person or entity. Only securities on the 13F list provided quarterly by the SEC (13F Securities) are required to be included in Form 13F Reports. Therefore, Form 13F Reports may not reflect the most current holdings of institutional investment managers because it is required that the 13F Report include only 13F Securities, is filed on a lag, and some funds may not meet the filing thresholds or other requirements. In addition, because the 13F Reports are as of the last date of the quarter, the 13F Report may not describe intra-quarter activity.

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