To most investors, hedge funds are assumed to be underperforming, outdated financial tools of the past. While there are over 8000 funds with their doors open at present, we look at the masters of this group, close to 450 funds. It is estimated that this group oversees the lion’s share of the smart money’s total capital, and by keeping an eye on their best equity investments, we have formulated a few investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 25 percentage points in 6.5 month (see all of our picks from August).
Equally as important, optimistic insider trading sentiment is a second way to parse down the stock market universe. Obviously, there are a number of reasons for an insider to get rid of shares of his or her company, but only one, very simple reason why they would buy. Several academic studies have demonstrated the useful potential of this strategy if “monkeys” understand what to do (learn more here).
Keeping this in mind, we’re going to take a look at the key action surrounding Boyd Gaming Corporation (NYSE:BYD).
What does the smart money think about Boyd Gaming Corporation (NYSE:BYD)?
Heading into 2013, a total of 16 of the hedge funds we track were long in this stock, a change of 33% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their stakes significantly.
According to our comprehensive database, Paul ReederáandáEdward Shapiro’s PAR Capital Management had the most valuable position in Boyd Gaming Corporation (NYSE:BYD), worth close to $43 million, accounting for 1.9% of its total 13F portfolio. On PAR Capital Management’s heels is H Partners Management, managed by Rehan Jaffer, which held a $26 million position; 0.2% of its 13F portfolio is allocated to the company. Some other hedgies that hold long positions include Mario Gabelli’s GAMCO Investors, Boaz Weinstein’s Saba Capital and David Tepper’s Appaloosa Management LP.
Consequently, key hedge funds were leading the bulls’ herd. Balyasny Asset Management, managed by Dmitry Balyasny, established the most valuable position in Boyd Gaming Corporation (NYSE:BYD). Balyasny Asset Management had 9 million invested in the company at the end of the quarter. Eric Semler’s TCS Capital Management also made a $4 million investment in the stock during the quarter. The following funds were also among the new BYD investors: David Keidan’s Buckingham Capital Management, Steven Cohen’s SAC Capital Advisors, and Israel Englander’s Millennium Management.
How are insiders trading Boyd Gaming Corporation (NYSE:BYD)?
Bullish insider trading is most useful when the company in focus has experienced transactions within the past 180 days. Over the last 180-day time frame, Boyd Gaming Corporation (NYSE:BYD) has seen 1 unique insiders buying, and 1 insider sales (see the details of insider trades here).
With the results demonstrated by our time-tested strategies, everyday investors must always keep an eye on hedge fund and insider trading activity, and Boyd Gaming Corporation (NYSE:BYD) shareholders fit into this picture quite nicely.
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