Huge New York Pension Fund Went Against the Institutional Grain With Some Q1 Investments

America’s fourth-largest pension fund sold many more stocks than it bought in the first quarter. But the stocks that The New York State Common Retirement Fund did purchase were quite diversified, as investment managers there bought multiple industrial, information technology, defensive, and consumer-discretionary names.

The fund provides retirement security for over one million New York State and Local Retirement System (NYSLRS) members, retirees and beneficiaries. At the end of December 2022, the fund was valued at $242.3 billion, with 43.49% of its assets invested in publicly traded equities.

Data compiled by Fintel indicates those equities holdings were comprised of 3,207 stocks.

Against the Grain

In analyzing the 10 stocks that the fund loaded up on last quarter, several of them would appear to be contrarian moves, vis-a-vis institutional investors.

Based on the Fund Sentiment scores shown in the table below, at least five of the stocks purchased by the New York Common Retirement Fund garnered scores below 50.

The Fund Sentiment, or Ownership Accumulation, score is a proprietary quantitative model that ranks companies based on levels of ownership accumulation. To calculate the ranking, we look at two key factors: the change in the number of disclosed owners over the prior quarter, and the change in portfolio allocation of existing owners over the prior quarter.

Industrial Stocks

Within the industrial sector, the fund bought significant amounts of Cadence Design Systems (US:CDNS), Mohawk Industries (US:MHK), Stag Industrial (US:STAG), and Danaher (US:DHR).

The fund bought 16,442 shares of Cadence Design, increasing its total position in the name by 4.19%. Cadence ” provides software, hardware, services, and reusable integrated circuit design blocks.” As the market’s June 26 close, CDNS had climbed almost 40% in 2023.

Next on the list of industrial stocks is Mohawk Industries. The fund bought 29,219 shares of the name, increasing its holding of the stock by 10.6%. MHK “designs, manufactures, sources, distributes, and markets flooring products for residential and commercial remodeling, and new construction channels.” MHK was down 6.6% so far this year, with declines stemmed by the past month’s 5% rebound.

The pension fund acquired 340,591 shares of Stag Industrial, raising its holdings of the stock by 42%. Stag is a REIT focused on the acquisition, ownership and operation of industrial properties.

Last in the industrial category is Danaher. The fund bought 32,332 shares of DHR, increasing its holdings by 2.45%.  The firm is a conglomerate that “designs, manufactures, and markets professional, medical, industrial, and commercial products and services worldwide.”

Information Technology

In the IT sector, the fund bought significant stakes of HubSpot (US:HUBS), Texas Instruments (US:TXN), Taiwan Semiconductor (US:TSM), and MongoDB (US:MDB).

The fund increased its position in HubSpot by 1.59%, buying another 2,189 shares. HUBS provides a cloud-based customer relationship management (CRM) platform for businesses. The stock has climbed 76% so far this year.

Two chip makers are next on the list. Specifically, the fund bought  24,800 more shares of Texas Instruments, raising the number of TXN shares it owns by 1.3%. The other chip maker is Taiwan Semiconductor, the largest name in the sector.The pension fund acquired a whopping 264,155 shares of TSM stock last quarter, increasing its stake by 12.66%. TXN and TSM have climbed 3.4% and 35.2%, respectively, in 2023.

The fund also acquired 13,977 shares of MongoDB, raising its stake in the company by 10.9%. The company provides a general purpose database platform and its shares have almost doubled in value so far this year.

Defensive

In the defensive category, the fund bought Monster Beverage (US:MNST), O’Reilly Automotive (US:ORLY), and Parsons Corp (US:PSN). 

It hiked its stake in Monster by 112%, bringing its total position in the name to 1.3 million shares. MNST has climbed almost 14% in 2023.

The fund raised its stake in auto parts retailer O’Reilly by 5.23%, bringing its total position in the name to 91,262 shares.

Parsons provides integrated solutions and services in the defense, intelligence, and critical infrastructure market. Its share price is up 4.9% this year.

This article originally appeared on Fintel

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