INVESTMENT HACKS
The hedge funds have finished their SEC mandated holdings reports. So now it’s time to take stock of where they are putting their money. The tech sector, which was long a favorite of the hedge funds, is underperforming right now. Going into the Thanksgiving weekend, the ‘FAANG’ (Facebook, Amazon, Apple, Netflix, and Alphabet’s Google) stocks as a group have lost nearly $1 trillion since their peak valuations earlier this year.
Without the tech stocks no longer generating returns, the funds are moving towards more defensive investments. Think utility companies, health insurers, and defense contractors. According to Goldman Sachs’ David Kostin, “Hedge funds rotated toward defensive sectors during the third quarter, lifting utilities to an overweight vs. the Russell 3000 for the first time since 2008. Funds also added to positions in consumer staples while reducing positions in the info tech, communication services, and consumer discretionary sectors.”
Moving along this track, major hedge funds have opened positions in Boeing, UnitedHealth, and Edison International this past quarter. We’ll use the TipRanks database to find out what the analysts have to say about these investments.
Boeing Company (BA – Research Report)
The Seattle-based aerospace company is best known for its family of airliners, ranging from the famous 747 to the latest 737 MAX. In addition to its successful commercial aircraft, Boeing is a major player in the defense industry, producing variety of helicopters, fighters, and tankers for the US Department of Defense.
Boeing is also a go-to stock for hedge funds. According to TipRanks data, the major funds increased holdings in Boeing by more than 300,000 shares in the last quarter. While BA’s share price has slumped recently – caught up in the general market fall – the hedge fund acquisitions send a message of confidence in the stock.
