Revamping a Portfolio: Comparing Lucha Capital Management's Q2 and Q3 2019 Holdings

Investment portfolios are like living organisms that need the right elements to flourish. Portfolio managers are always on the lookout for opportunities to optimize their holdings by adding, reducing, or completely eliminating certain positions. Lucha Capital Management is no exception. In this blog post, we're going to take a look at their second and third-quarter 2019 holdings and see which positions they increased or decreased, and what their potential reasons for doing so were.

HeatlhEquity Inc, RealPage Inc, and Take-Two Interactive Software Are in Favor

According to the Q2-Q3 2019 13F Holdings Comparison, Lucha Capital Management increased its holdings in HealthEquity Inc (HQY) from 284,843 shares to 338,237 shares, a 3.8% increase. They also added to their position in RealPage Inc (RP) by 2.3%, despite reducing the number of shares from 277,274 to 265,594. However, their most significant increase was in Take-Two Interactive Software's (TTWO) shares, which they bumped from 97,673 to 108,643, a whopping 22.8% increase, although the value of the shares only went up from $11,089,000 to $13,617,000.

Electronic Arts Inc, GoDaddy Inc, and PayPal Holdings Inc are Facing Cutting-Backs

On the flip side, Lucha Capital Management reduced its holdings in Electronic Arts Inc (EA) by a massive 36.6%, from 225,884 to 148,244 shares. PayPal Holdings Inc (PYPL) wasn't any luckier as the fund cut back its shares by 29.4% from 161,861 to 126,281. GoDaddy Inc (GDDY) was another victim of the trimming shiring saw its holdings reduced by 27.5% from 263,439 to 203,029 shares.

New Stocks Enter the Scene while Others Exit

New positions that Lucha Capital Management entered for the first time during the third quarter included Anaplan Inc (PLAN), Zendesk Inc, MongoDB Inc (MDB), 2U Inc (TWOU) and Carbon Black Inc (CBLK). On the other hand, other stocks like Fidelity Natl Information Sv (FIS), Wayfair Inc (W), and Micron Technology Inc (MU) were exited.

Why the Changes?

Portfolio managers make adjustments to their holdings for various reasons. For instance, they may increase their positions in certain stocks because they believe they offer great potential for growth or because they expect to receive higher profits. Alternatively, they may reduce or eliminate their holdings in stocks whose potential future performance is uncertain or not performing well. Such was the case for Fidelity Natl Information Sv (FIS) that they fully exited. No matter the reason, it's important to note that portfolio managers always strive to optimize their holdings, aiming to maximize returns and minimize risks.

Conclusion

From the Q2-Q3 2019 holdings comparison, we can deduce that Lucha Capital Management is experimenting with their portfolio, opening up new positions while trimming back in others. Whether this is a sign of their bullish or bearish bets on certain stocks remains to be seen. However, one thing is for sure just like the stock markets, investment portfolios can be quite volatile and subject to changes. Therefore, it's always advisable for investors to stay updated on the holdings and activities of any company in which they are considering investing.