What’s a smart Alexandria Real Estate Equities Inc (NYSE:ARE) investor to do?
If you were to ask many of your peers, hedge funds are seen as useless, old investment vehicles of a forgotten age. Although there are more than 8,000 hedge funds in operation in present day, Insider Monkey aim at the crème de la crème of this club, about 525 funds. Analysts calculate that this group controls the majority of all hedge funds’ total capital, and by tracking their highest quality equity investments, we’ve found a few investment strategies that have historically beaten the S&P 500. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 33 percentage points in 11 months (find the details here).
Equally as crucial, bullish insider trading sentiment is another way to analyze the investments you’re interested in. There are many reasons for an insider to cut shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several academic studies have demonstrated the useful potential of this method if you understand where to look (learn more here).
Furthermore, it’s important to discuss the newest info surrounding Alexandria Real Estate Equities Inc (NYSE:ARE).
What does the smart money think about Alexandria Real Estate Equities Inc (NYSE:ARE)?
At the end of the second quarter, a total of 10 of the hedge funds we track were bullish in this stock, a change of -9% from one quarter earlier. With hedge funds’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings significantly.
When using filings from the hedgies we track, Jeffrey Furber’s AEW Capital Management had the biggest position in Alexandria Real Estate Equities Inc (NYSE:ARE), worth close to $72 million, accounting for 1.9% of its total 13F portfolio. The second largest stake is held by Two Sigma Advisors, managed by John Overdeck and David Siegel, which held a $6.5 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedgies that are bullish include Ken Griffin’s Citadel Investment Group, Israel Englander’s Millennium Management and Matthew Tewksbury’s Stevens Capital Management.
Since Alexandria Real Estate Equities Inc (NYSE:ARE) has faced bearish sentiment from upper-tier hedge fund managers, we can see that there exists a select few money managers that slashed their entire stakes heading into Q2. It’s worth mentioning that Jim Simons’s Renaissance Technologies cut the largest stake of the “upper crust” of funds we watch, worth close to $6.9 million in stock. David Costen Haley’s fund, HBK Investments, also cut its stock, about $0.8 million worth. These transactions are interesting, as aggregate hedge fund interest was cut by 1 funds heading into Q2.
How are insiders trading Alexandria Real Estate Equities Inc (NYSE:ARE)?
Legal insider trading, particularly when it’s bullish, is at its handiest when the company we’re looking at has seen transactions within the past 180 days. Over the latest half-year time frame, Alexandria Real Estate Equities Inc (NYSE:ARE) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We’ll also take a look at the relationship between both of these indicators in other stocks similar to Alexandria Real Estate Equities Inc (NYSE:ARE). These stocks are CommonWealth REIT (NYSE:CWH), Highwoods Properties Inc (NYSE:HIW), Piedmont Office Realty Trust, Inc. (NYSE:PDM), Kilroy Realty Corp (NYSE:KRC), and Liberty Property Trust (NYSE:LRY). This group of stocks are in the reit – office industry and their market caps match ARE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| CommonWealth REIT (NYSE:CWH) | 33 | 0 | 0 |
| Highwoods Properties Inc (NYSE:HIW) | 8 | 0 | 0 |
| Piedmont Office Realty Trust, Inc. (NYSE:PDM) | 8 | 0 | 0 |
| Kilroy Realty Corp (NYSE:KRC) | 9 | 0 | 0 |
| Liberty Property Trust (NYSE:LRY) | 13 | 0 | 0 |
Using the results shown by the previously mentioned tactics, average investors must always pay attention to hedge fund and insider trading activity, and Alexandria Real Estate Equities Inc (NYSE:ARE) applies perfectly to this mantra.
