The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage. NEW YORK ( Insider Monkey) -- Hedge funds can be invested in companies for all sorts of reasons. Usually, "monkeying" hedge fund managers' top purchases is a fairly sound investment strategy. After all, these managers have teams of people studying the market. Hedge funds also report their holdings once a quarter, so it is easy for do-it-yourself investors to follow along. There's one problem, however. When hedge funds report their holdings, they provide only snapshots of the positions they held at the end of the previous quarter, whether they intended to hold those stocks for 10 days or 10 years. In order to determine whether a stock a hedge fund manager is holding is really worth buying, it's a good idea to pay attention to what hedge fund managers are doing across the board. This is particularly useful for complicated and constantly changing industries such as business software and services. With that in mind, here is a list of business services and software companies that hedge funds are buying: Cognizant Technology Solutions Corp. ( CTSH): Of the 300-plus hedge funds we track, 33 had positions in CTSH at the end of the third quarter, up from 27 at the end of the second quarter. Total hedge fund investment in CTSH also increased, moving from $1.50 billion at the end of June to $1.53 billion at the end of September. Stephen Mandel's Lone Pine Capital had $670.71 million in CTSH after increasing his stake in the company by 24% in the third quarter. Lee Ainslie's Maverick Capital is also a fan. Automatic Data Processing ( ADP): There were 24 hedge funds invested in ADP at the end of the third quarter. That's the same number that had stakes in the company at the end of the second quarter, but the total volume of hedge fund investment in the company went up from $324.09 million at the end of June to $327.72 million at the end of September. ADP is a favorite of Jean-Marie Eveillard's First Eagle Investment Management. It had $147.82 million invested in ADP at the end of the third quarter after upping its stake in the company by 2%.
S1 Corp. ( SONE): Hedge fund investment in SONE increased dramatically during the third quarter. By the end of the quarter, 19 hedge funds had $124.76 million invested in the company, up from 14 funds with $59 million invested at the end of the second quarter. Israel Englander's Millennium Management is a fan of SONE, as is Cliff Asness' AQR Capital Management. Blue Coat Systems ( BCSI): The number of hedge funds invested in BCSI did not change during the third quarter. There were 16 funds invested in the company at the end of June, and the same number was invested in the company at the end of September. The total volume of hedge fund investment in the company nearly doubled, however, moving from $63.64 million at the end of the second quarter to $119.23 million at the end of the third quarter. Both Michael Lowenstein's Kensico Capital and Lee Hobson's Highside Capital Management like BCSI. SuccessFactors ( SFSF): The number of hedge funds invested in SFSF did not change from the end of June to the end of September, but the volume of that investment did increase. It moved from $155.64 million across 16 funds at the end of the second quarter, to $173.28 million across 16 funds at the end of the third quarter. Steve Cohen's SAC Capital Advisors, Bain Capital's Brookside Capital and Donald Chiboucis' Columbus Circle Investors each increased positions in SFSF during the third quarter. Datalink Corp. ( DTLK): The number of hedge funds invested in DTLK doubled from the end of the second quarter, when just three hedge funds were invested in the company, to six at the end of the third quarter. Total hedge fund investment also increased, moving from just $540,000 at the end of June to $3.81 million at the end of September. Jim Simons' Renaissance Technologies, Richard Driehaus' Driehaus Capital and Israel Englander's Millennium Management are fans of DTLK.