I've been keeping a close eye on what substantial shareholders have been doing recently. Especially following the market crash.
Substantial shareholders are those 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.
As a result, I feel investors should look to use these notices to their advantage. After all, they show where the so-called smart money is going.
Two notices that have caught my eye are summarised below:
Blackmores Limited (ASX: BKL)
FIL Limited, better known as Fidelity International, has been buying this health supplements company's shares this month. According to a change of interests of substantial holder notice, Fidelity has increased its holding in Blackmores by 182,662 shares. This leaves Fidelity with a total of 1,148,028 shares, which lifts its stake from 5.5% to 6.59%.
Fidelity started topping up on the company's shares at the end of February when they were changing hands for $65.38. This has proven to be a smart move by the fund manager. At the close of play on Wednesday, Blackmores' shares were trading almost 15% higher at $75.05. The fund manager may believe Blackmores is benefiting from panic buying of vitamins during the pandemic.
Volpara Health Technologies Ltd (ASX: VHT)
Volpara is a medical technology software as a service company which has been attracting interest from a leading New Zealand based investment management company. According to a change of interests of substantial holder notice, Harbour Asset Management has recently added a further 2,286,397 shares to its holding. This has increased its stake to a total of 19,677,115 shares, which is the equivalent of ~9% of its shares outstanding.
Despite rebounding strongly over the last few weeks, Volpara's shares are still down 42% from their 52-week high. It appears as though Harbour Asset Management believes this selloff has created a buying opportunity for investors. And given its strong growth potential and exciting technology, I'm inclined to agree.
