Shifting Expectations: Squarepoint Ops LLC's Q3 vs. Q4 2022 13F Holdings

As we look towards the end of the year, it’s important to reflect on the shifts in investments seen in Q3 versus Q4 2022. Squarepoint Ops LLC, a quantitative investment management firm, has made changes to their holdings that could be indicative of larger trends in the market. In this blog post, we'll explore some of the changes made between Q3 and Q4 and what they may mean.

Overall, the biggest change seen in the 13F Holdings comparison was the addition of a significant number of call and put options. For example, in Q3 Squarepoint Ops LLC held no call options for the iShares TR (FXI) but had acquired 11,563,700 of them in Q4. Similarly, they had no put options for the Invesco QQQ TR (QQQ) in Q3 but had acquired 1,194,700 in Q4. This change in strategy may reflect a shift in expectations for the overall direction of the market.

One stock that saw a notable increase in shares held by Squarepoint Ops LLC was Ulta Beauty Inc (ULTA). In Q3, they held 252,112 shares, but by Q4 they had increased that number to 245,183. This increase aligns with a larger trend of increased consumer spending on beauty products, despite the pandemic's continuing effects on the economy. It could also reflect an expectation of continued growth for the company.

On the other hand, while Squarepoint Ops LLC had no holdings for Zillow Group Inc (Z) in Q3, they had acquired 2,074,200 call options in Q4. This may indicate a more bullish outlook on the company's prospects, perhaps based on the potential for continued growth in the real estate market or additional upside from the company's recent move into home buying and selling.

One surprising shift seen in the comparison was that of the SPDR S&P 500 ETF TR (SPY) call options. While Squarepoint Ops LLC held over 1.2 million in Q3, that number had decreased to just over 1 million in Q4. At the same time, put options for SPY increased, going from 513,700 in Q3 to 484,900 in Q4. This shift could suggest a change in sentiment for the overall market, with investors potentially becoming more cautious and hedging against potential losses.

Another interesting change was the decrease in holdings of the Invesco QQQ TR (QQQ), both in shares held and overall value. In Q3, Squarepoint Ops LLC had 1,331,600 shares valued at $355,883, but by Q4 those numbers had dropped to 1,208,000 shares valued at $321,666. This decrease may align with concerns around the potential for a tech bubble, especially since the QQQ has a heavy focus on tech companies.

Overall, the changes in Squarepoint Ops LLC's 13F Holdings between Q3 and Q4 2022 are indicative of a shifting market, with investors potentially becoming more cautious and hedging against potential losses. At the same time, there are indications of continued growth potential in certain sectors, such as the beauty industry. While the impact of these shifts on the overall market remains to be seen, they are certainly worth paying attention to as we head into the new year.