Tracking The Composite Models

New York ( – One of the things that we have wanted to provide our readers is information about where the models on the platform are moving money, without actually divulging any proprietary information. With the recent release of the composite models, we now have the ability to evaluate where the managers as a whole are directing money. With this in mind, the following tables show where the money is distributed with the composite models. The first table shows four of the five long/short models with the only one not shown being the HedgeCoVest REITS Long/Short because that model only invests in REITs.

Looking at some of the numbers, we see that there is a pretty strong bullish skew within the Biotech model. Over 80% of the positions are allocated toward the long side and less than 20% are dedicated to short positions. The opposite is true of the basic materials sector as we see over 80% of positions dedicated to the short side while less than 20% are dedicated to long positions.

Model Bullish Breakdown Bearish Breakdown Skew Top Longs Top Shorts YTD Return
HedgeCoVest Biotech LS Biotech 54%,
Pharma 46%
50% Biotech,
50% Pharma
HedgeCoVest Technology LS 36% SoftWare, 32% Semis, 27% Hardware 39% Semis, 33% Hardware, 28% Software Slight Bullish OIIM, MU, EMC, ININ, LPSN CARB, AMAT, CDNS, NVDA, ADI 3.12%
HedgeCoVest Basic Materials LS 51% Telecomm, 49% Chem 66% Chem, 22% mining, 11% Steel Strong Bearish ALU, PPG ATI, FMC, DD, FCX, CE 1.18%
HedgeCoVest Energy and Utilities LS 39% Elec, 38% Oil & Gas, 15% Alt 50% Oil & Gas, 25% Elec Slight Bearish ENOC, ETR, PEG, XEL, ED TE, SO, CMS, PXD, WMB 0.57%

The second table shows the breakdown for the long-only models. Since there isn’t a bearish component to breakdown, there is a little less information in this table, but it still shows how the assets are distributed with the sub-sectors. For instance we see within the tech sector that just over half the assets are dedicated to software companies as compared to 24% for semiconductors and 21% for hardware. You can also see the top five holdings within each model.

Model Breakdown Top Holdings YTD Return
HedgeCoVest Biotech L 54% Biotech, 46% Pharma SNTA, EXAS, TEVA, ICPT, BMY 24.77%
HedgeCoVest Index L 12% Software, 9.5% Div Financial, 7.9% Internet, 7% Telecom, 6.3% Retail SNTA, OIIM, SAAS, HALL, NMRX 6.05%
HedgeCoVest Technology L 51% Soft., 24% Semis, 21% Hardware OIIM, SAAS, SEAC, EMC, SNCR 4.74%
HedgeCoVest Energy and Utilities L 39% Electric, 38% Oil & Gas, 15% Alt Energy, 7.6% Pipelines ETR, ENOC, PEG, ED, XEL 0.62%
HedgeCoVest Industrial L 38% Electronics, 23% Aero/Defense, 15% Metal Fab., 7.8% Machinery, 7.6% Eng & Construction JBL, AGCO, LMT, SNHY, LLL -2.02%

The short-only models haven’t fared as well as the other groups as the market has been moving higher for the first five months of 2015. Regardless of the market direction, we see that within the Index Short-Only model, the retail sector is the most disliked among our managers with banks a distant second at this time. Banks are the most disliked of the sub-sectors in the Financial Short-Only model.

Model Breakdown Top Sells YTD Return
HedgeCoVest Index S 12% Retail, 6.7% Banks, 5.2% Transportation, 5.2% Semis, 4.5% Insurance, 4.% Internet BOX, RF, MTW, CARB, DNKN -1.57%
HedgeCoVest Basic Materials S 67% Chemicals, 22% Mining, 11% Iron/Steel ATI, MON, FCX, DD, FMC 0.06%
HedgeCoVest Financials S 45% Banks, 25% Div Financials, 30% Insurance RF, SCHW, GS, BBT, ZION -2.19%
HedgeCoVest Industrial S 26% Transportation, 19% Machinery, 11% Miscellaneous, 11% Electronics, 7.5% Packaging & Containers MTW, OI, TNC, CSX, WERN -2.43%

Rick Pendergraft
Research Analyst

This entry was posted in HedgeCo News, HedgeCoVest News and tagged , , , , , . Bookmark the permalink.

Leave a Reply