This particular strategy involves doing a little research on the largest hedge funds with substantial holdings in a particular stock/security.  In the example below, I will show you how I investigate Blackrock and their holdings (13F).

• 13D - must be filed within 10 days of an organization or fund acquiring more than 5% of a companies stock

• 13F - must be filed every quarter (45 days to file); actionable dates are listed (buying or selling), but this could be upwards of 4 months after the actual purchase or sell off. 

• I look for large insitutional buying and mark the levels at which they were purchased to be used as areas of support.

• I also look for large institutional selling to mark levels as resistance.

• In both cases, I look for the opposite occurance. If I see a large buy, I do not want to see shares being sold in quantities larger than the purchases and vise versa. 

• Even if there are large sales after large purchases, most businesses are using FIFO (First In, First Out) for their shares being sold. This is a tax advantage since the shares are treated as long term capital gains (lower taxation). LIFO (Last In, First Out) is not common for hedge funds to use since it puts a bigger tax burden.  

• Search Blackrock 13F Filing. Since they are the biggest hedge fund and controls $9.42 trillion (July 2023), I am very interested in what they are doing in the market. 

• Click on the Fintel.io seems to have the simplest format for the 13F filing. There are others you can compare them to, but this was the one I liked the best without doing a deep search.

Click on the most recent 13F-HR filing to see what transaction they have completed since the last quarter.

• Use a search to find the stock you are interested 

• You can also search based on positions they have entered or exited (Change Percent). There are other sites to show new positions or positions they have exited (See Hedgefollow.com or just do a simple search in Google and someone is talking about what they are doing).

• Next, click on the arrow (black circle) to see the actual transactions of the company

• Scroll down to the 13F Filings

• Here are a few things I look at:

  • Effective dates - this is the date that the transactions occurred. This allows us to track on our charts and see what happened months later. Look to see if there is a pattern to their quarterly purchasing or if it is always on the same date (e.g. end of month)

  • ΔShares - tells us the amount of change in shares. I look for the highest numbers +/- to mark my charts.  

  • ΔShares (%) - we can easily go through this column to see if a significant amount stands out from all other transactions. In this case, we see -2.5, 2.35, and 2.54 are the largest moves. These are the dates I look at my charts to see if there if there is support or resistance based upon their moves.

• In this case I see that MSFT makes their transactions on the last day of each quarter regardless of market moving up or down.

• While MSFT made a huge sale for 12.9M shares on 06/30/2021, I also see that they made other huge purchases after that point in the amounts of 11.9M (12/31/21) and 13.1M (12/31/22). 

• It also seems like MSFT is simply core trading or churning out old stock (FIFO) for profit taking periodically after holding for longer than 365 days; in some cases even longer than two years.

• Search Blackrock 13F Filing to get started. You will be able to find other large hedge funds and what they are doing with the same stocks/securities. 

• Scroll down to see Blackrocks top 50 holdings and whether they are increasing or decreasing their positions

• Click on any of their holdings to see who else owns that security and what they are doing

• You will find all types of statistics on how many hedge funds own a position in the stock, the size of their stake, average rank in portfolios, and a comparison to the previous quarter

• An interesting section is the gauge that shows whether there are more buyers than sellers during that particular quarter.

• Remember, even hedge funds are in competition with other hedge funds. 

• You can sort by the largest investors to see what they are doing since they control the market with a larger position

• Sort by those increasing their position, decreasing their position, starting a new position, or closing their position

• This can give you some quick context on the current sentiment if there is a large number of buyers or sellers

• You can use this to check the larger hedge funds 13F filings as well to find some confluence in their buying/selling positions