By ETF Professor
It is safe to assume most investors would like to invest along side the smart money. A difficult task to be sure, but the upcoming 13F filings courtesy of the Securities and Exchange Commission, or SEC, can certainly help.
For those not in the know, here is a quick explanation of what 13Fs are straight from the source, the SEC: "An institutional investment manager that uses the U.S. mail (or other means or instrumentality of interstate commerce) in the course of its business, and exercises investment discretion over $100 million or more in Section 13(f) securities (explained below) must report its holdings on Form 13F with the Securities and Exchange Commission (SEC)."
In late 2011, we looked at some ETFs that were prized by hedge funds, endowments and other big money managers. So with this list we're looking for some fresh additions while limiting the number of funds that make a second appearance.
SPDR Gold Shares (NYSEARCA:GLD): We might as well get one of the duplicates in our list out of the way early. GLD, the largest physically backed commodities fund and second-largest ETF overall in the world, is a favorite of the smart money crowd.
Interestingly, Paulson & Co. cut its GLD stake in the fourth quarter for the second straight quarter, while George Soros, who has previously warned of a gold bubble, added to his GLD position. Vinik Asset Management LP, Tudor Investment Corp. and SAC Capital Advisors LP also pared their GLD positions.
iShares FTSE China 25 Index Fund (NYSEARCA:FXI): FXI is off to a fine start in 2012. That's music to the ears of the Yale Endowment Fund, which added shares of FXI in the fourth quarter. As FXI's chart indicates, regardless of when Yale bought the ETF, the Ivy League school is now in the green on this trade.
That's good, but Yale could have done better. The Guggenheim China Small-Cap ETF (HAO) is up more than FXI year-to-date and has a lower expense ratio. Yale's bitter rival Harvard has also held FXI in its own endowment fund for some time.
iShares iBoxx $ Investment Grade Corporate Bond ETF (NYSEARCA:LQD): One of Ken Fisher's largest positions at the end of the Q4, LQD offers a yield north of 4%. That's a lot better than Treasuries offerm with barely any more risk.
Fun facts about LQD: At the end of January, it was the tenth-largest ETF in the U.S. by assets and the second-largest bond fund.
SEC filings indicate Moore Capital Management LLP - Louis Moore Bacon's hedge fund - owned 3 million XHB shares at the end of 2011. Even if all of that stake was purchased in December, Moore Capital is now deep in the money on XHB.
iShares MSCI Brazil Index Fund (NYSEARCA:EWZ): The largest Brazil-specific fund was the Harvard endowment's largest position by market value at the end of the third-quarter. It will be interesting to see if the richest U.S. college sold or added into EWZ's strength in Q4, and it will be really interesting to see where EWZ stands with Harvard at the end of the current quarter.
However, Harvard isn't the only institutional owner of EWZ. Not by a long shot. More than 30 advisors, banks, hedge funds and pension funds own stakes in EWZ, according to data from Tickerspy.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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