I like to keep a close eye on what substantial shareholders are doing. Especially during this recent market volatility.
Substantial shareholders are shareholders that hold 5% or more of a company's shares. These tend to be large investors, asset managers, and investment funds. These shareholders are obliged to update the market when they make any changes to their holdings.
I feel investors should look to use these notices to their advantage. After all, they show where the "smart money" is going.
Two notices that have caught my eye are summarised below:
Audinate Group Ltd (ASX: AD8)
A change of substantial holder notice reveals that Smallco Investment Manager has taken advantage of a pullback in the Audinate share price to top up its position. Smallco is a small-cap focused investment company which manages in excess of $850 million. According to the notice, Smallco has lifted its stake in the leading audio-visual networking technologies provider from 8.1% to 9.2%. It appears to believe the recent pullback in the Audinate share price is a buying opportunity for investors. The company's shares came under pressure after tariffs and delays in launches weighed heavily on its revenue growth during the first half. Judging by its purchase, Smallco appears confident this is just a temporary headwind.
Bapcor Ltd (ASX: BAP)
A change of substantial holder notice reveals that annuities company Challenger Ltd (ASX: CGF) has been buying the shares of this automotive aftermarket parts distributor. Challenger picked up almost 3.6 million Bapcor shares recently, bringing its total holding to 18.34 million shares. This means the annuities company now owns a 6.45% stake in the company. With Bapcor's shares down materially from their 52-week high and trading within sight of their 52-week low, it appears as though Challenger believes they have fallen to a very attractive level. Especially after the release of its record half year result in the middle of last month.
