Via Silicon Peaks and Valleys
Silicon Peaks and Valleys uses 13F data to visualise the way hedge funds’ have invested in tech companies over the last 5 years.
Take a look here: https://www.intertrader.com/
As you can see there are two views; Change Over Time, with dynamic bubbles showing how hedge funds have invested in Google, Yahoo!, Netflix, and GrubHub over the past 5 years, and Explore the data, which has all of the 17 companies studied.
Mechanism
We have isolated the world’s top hedge fund’s investments in tech stocks, to subsequently understand, and visualise, how heavily Wall Street invests in tech. We do this by using the crowdedness metric, which is a 3-step process:
- Using 13F data, the total institutional holdings in any given company are determined?.
- This data is then cut to reveal just the hedge fund holdings?.
- Total hedge fund holdings are then divided by the total institutional holdings to reveal a % crowdedness score.
Apologies for the audacious email. But as well as the overall visualisation angle there are a ton of hooks here and I have outlined some of them individually below with their own sub headings below in addition to the intro:
New Kids On The Block
Three of the companies that we analysed, GrubHub, Twitter, and Facebook, have IPOed in the last five years. The biggest winner of the trio was GrubHub, the crowdedness of which has increased more than four times over, from 7% to 30%, since it went public in 2014. (Note that this data naturally doesn’t include the hit the stock has taken with the recent comments made by Matt Maloney).
Similarly, although Facebook and Twitter haven’t seen as much of their total investment percentage taken up by hedge funds as GrubHub, they have both seen increased crowdedness since their IPO dates. Check out all three of them side by side (with their respective stock prices, too):
Pressing Pause on Netflix
Although often considered the darling of the new media world, due to its spearheading a revolution in television, hedge funds are dumping Netflix stock in record numbers. Overall it’s crowdedness has gone down 10% since 2013, when it launched its first original drama series House of Cards, whilst the precipitous fall in Q1 of 2016, a 6% loss in one quarter, is a sign that investors think that the streaming service has hit a wall.
Overall the Netflix graph serves as a perfect example of how the company has pivoted its business approach this decade. But, despite the rise in stock over the same time, hedge funds have decided that Netflix’s reign in the progressively more democratic world of digital streaming, may well be over.
The Rise of Yahoo!
Although there are numerous problems at the multinational technology behemoth, including the numerous hacking scandals, and the continued criticism of their CEO Marissa Mayer, hedge funds have continued to invest heavily in Yahoo in 2016.
As of Q1, the crowdedness of Yahoo is at a 5 year peak, at 35.89%. This increase came before the announcement by Verizon that it was to buy the core element company for $4.8 billion, a deal which of course still has its question marks, but was certainly an influencer on how hedge funds have bought into it as acquisition rumours swirled earlier this year.
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Silicon Peaks & Valleys by Intertrader
Silicon Peaks & Valleys by Intertrader
