Published on 1 Nov 2021 on Insider Monkey via Yahoo Finance
Were Hedge Funds Right About Snowflake Inc (SNOW)?
We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn't mean that they don't have occasional colossal losses; they do (like Melvin Capital's recent GameStop losses). However, it is still a good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards Snowflake Inc (NYSE:SNOW). Is Snowflake Inc (NYSE:SNOW) ready to rally soon? The best stock pickers were taking a bearish view. The number of long hedge fund bets were cut by 1 lately. Snowflake Inc (NYSE:SNOW) was in 70 hedge funds' portfolios at the end of the second quarter of 2021. The all time high for this statistic is 71. Our calculations also showed that SNOW isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings). To the average investor there are plenty of tools shareholders employ to appraise publicly traded companies. Two of the best tools are hedge fund and insider trading indicators. Our researchers have shown that, historically, those who follow the best picks of the best money managers can outperform the broader indices by a very impressive amount (see the details here). Also, our monthly newsletter's portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website.
Philippe Laffont of Coatue Management At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, the demand for helium is soaring and there is a helium supply shortage, so we are checking out stock pitches like this emerging helium stock. We go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. 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. Keeping this in mind we're going to take a peek at the fresh hedge fund action surrounding Snowflake Inc (NYSE:SNOW).