The FTSE 100 hasn’t had a status for excellent returns just lately. However current 13F filings point out that high-powered hedge funds have been alternatives within the UK. 

By itself, this isn’t a motive to purchase (or promote) a inventory. However what the sensible cash has been doing could be a supply of concepts that is likely to be value a more in-depth look. 

Ashtead

Dodge & Cox is a value-focused funding operation. And through Q3, the agency purchased round 2.3m shares of commercial tools leasing firm Ashtead (LSE:AHT).

Thus far, that transfer has labored out very properly – the inventory is up 7.5% because the finish of September. The primary motive for that is the result of the US election.

Over 85% of the corporate’s revenues come from throughout the Atlantic. That form of geographic focus could be a danger, however sturdy US industrial exercise could possibly be a giant enhance for the FTSE 100 agency.

Demand for industrial tools is extremely cyclical. And which means I believe price-to-book (P/B) is a greater metric to make use of than price-to-earnings (P/E) with regards to valuing Ashtead shares.

Ashtead P/B ratio Nov 2023 – Nov 24

Created at TradingView

On this foundation, the inventory hit its lowest ranges of the yr between June and August. So even with out forecasting the election consequence, it might need regarded like a great time to be shopping for.

The current rally has seen the a number of climb again to the highest finish of its 12-month vary. That’s one thing buyers ought to contemplate earlier than deciding whether or not or to not observe Dodge & Cox.

Lloyds Banking Group

Maverick Capital opened a place in Lloyds Banking Group (LSE:LLOY) throughout Q3. The agency has investments in over 200 firms, however there’s a motive I believe that is attention-grabbing. 

The inventory is at present 4.5% decrease than the place it ended the third quarter. That is largely attributable to a courtroom ruling towards Shut Brothers in a case of commissions for automobile loans. 

Lloyds has important publicity to this space, however this isn’t information. What’s modified just lately is that the danger of great liabilities has elevated on account of the ruling towards Shut Brothers.

Sadly, buyers received’t discover out whether or not Maverick has achieved something in response to this till February. That’s the limitation of 13F filings – they’re solely up to date quarterly. 

That’s one more reason to not simply observe hedge funds into shares. However I don’t suppose this makes details about what hedge funds have been shopping for totally nugatory. 

The very fact the agency determined to purchase Lloyds, moderately than – for instance – Barclays is attention-grabbing to me. If nothing else, it offers me a motive to take a more in-depth look and see if I can determine why. 

Funding concepts

Plenty of buyers use 13F filings to concentrate to what Warren Buffett has been shopping for. However I believe there are many high-powered buyers which might be value listening to. 

Quite a lot of these have seen alternatives in FTSE 100 shares just lately. And whereas this by itself isn’t a ok motive for me to purchase a inventory, I don’t thoughts taking a more in-depth look.