Carillon Tower Advisers, an investment management firm, published its “Carillon Eagle Mid Cap Growth Fund” third quarter 2021 investor letter – a copy of which can be downloaded here. The Russell Midcap® Growth Index (down 0.76%) marginally outperformed its Russell Midcap® Value Index (down 1.01%) counterpart. Individual sectors across the Russell Midcap Growth were largely mixed, with financials (up 6.83%), real estate (up 4.05%), and information technology (up 2.15%) leading the way. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Carillon Tower Advisers, in its Q3 2021 investor letter, mentioned MSCI Inc. (NYSE: MSCI) and discussed its stance on the firm. MSCI Inc. is a New York, New York-based finance company with a $53.8 billion market capitalization. MSCI delivered a 46.31% return since the beginning of the year, while its 12-month returns are up by 67.33%. The stock closed at $653.34 per share on November 5, 2021.
Here is what Carillon Tower Advisers has to say about MSCI Inc. in its Q3 2021 investor letter:
“MSCI provides critical decision support tools and services for the global investment community. The firm’s stock was a strong performer in the quarter, as the company reported yet another impressive quarterly earnings update. MSCI is seeing strong demand for its rapidly growing and intriguing environmental, social, and governance (ESG) and climate solutions. At the same time, its factor solutions and index businesses remain robust.”
Based on our calculations, MSCI Inc. (NYSE: MSCI) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. MSCI was in 37 hedge fund portfolios at the end of the first half of 2021, compared to 38 funds in the previous quarter. MSCI Inc. (NYSE: MSCI) delivered a 4.09% return in the past 3 months.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
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Disclosure: None. This article is originally published at Insider Monkey.