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El Paso Topped Hedge Funds’ Overweight Stocks List in Q4

Google, Yahoo, General Dynamics and Family Dollar were all added to the list of the top 15 stocks most overweighted by hedge funds in Q4, while El Paso topped the list.

  • By Stephen Taub

Natural gas producer El Paso Corporation topped the list of 15 stocks most overweighted by hedge funds at the end of the fourth quarter. Meanwhile, four new stocks appeared on the list.

The new stocks are Google, Yahoo, General Dynamics Corporation and Family Dollar Stores, according to a new analysis by the quantitative research team at Credit Suisse Securities.

They bumped out Sears Holdings Corporation and AutoZone — top holdings of Eddie Lampert’s ESL Investments — as well as WellPoint and Beam.

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An active weight is taken when the weight of a stock within the aggregate hedge fund portfolio differs from the weighting of the stock in the S&P 500, Credit Suisse explains. Overweighted stocks have a greater weight in the hedge fund portfolio than in the S&P 500 benchmark.

On the other hand, Philip Morris International and Pfizer were the only new additions to the list of firms that hedge funds underweighted the most in the second quarter. They replaced PepsiCo and ConocoPhillips Company.

Remember, holders of at least $100 million in U.S. equity-oriented investments are required to tell regulators their holdings as of the last day of each quarter in a 13F filing with the Securities and Exchange Commission. It is a snapshot of one day in time. They also have up to 45 days from the end of the quarter to file these reports.

Most hedge funds like to wait until the last minute before pressing “send” on that filing; so the December 30 holdings were mostly reported around mid-February.

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