Alpha Clone – Established hedge fund managers tracked by the\u00a0AlphaClone Hedge Fund Long\/Short Index\u00a0distanced themselves from financial sector investments in the second quarter, representing a steep reversal from the previous quarter in which financials were the index\u2019s most overweight sector relative to the S&P 500.\u00a0 The bearish stance may illustrate conviction among hedge funds that financials are fully valued at these levels, especially in light of various high profile scandals that affected the sector negatively.<\/p>\n
Notable financial companies in which the index has sold out include Citigroup [C], JP Morgan Chase [JPM] and Hartford Financial [HIG]. Despite the underweighting, Financials represent the second largest sector represented in the index at a 13% allocation. Financial names the index continues to hold include Bank of America [BAC], American International Group [AIG] and Alleghany Corp. [Y] with the later representing a new index constituent.<\/p>\n