Buy Rda Microelectronics Inc (ADR) (RDA)?

Rda Microelectronics Inc (ADR) (NASDAQ:RDA) has seen an increase in enthusiasm from smart money in recent months.

In the eyes of most shareholders, hedge funds are seen as underperforming, old financial vehicles of years past. While there are more than 8000 funds with their doors open at present, we hone in on the crème de la crème of this club, around 450 funds. Most estimates calculate that this group has its hands on most of all hedge funds’ total asset base, and by tracking their highest performing picks, we have determined a number of investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum 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 trumped the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).

Just as key, positive insider trading sentiment is a second way to break down the world of equities. There are lots of reasons for a corporate insider to drop shares of his or her company, but only one, very clear reason why they would buy. Various academic studies have demonstrated the market-beating potential of this method if investors understand what to do (learn more here).

Consequently, it’s important to take a gander at the latest action surrounding Rda Microelectronics Inc (ADR) (NASDAQ:RDA).

Hedge fund activity in Rda Microelectronics Inc (ADR) (NASDAQ:RDA)

At the end of the first quarter, a total of 17 of the hedge funds we track were bullish in this stock, a change of 183% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their holdings substantially.

According to our comprehensive database, Crosslink Capital, managed by Seymour Sy Kaufman and Michael Stark, holds the most valuable position in Rda Microelectronics Inc (ADR) (NASDAQ:RDA). Crosslink Capital has a $7.1 million position in the stock, comprising 0.6% of its 13F portfolio. On Crosslink Capital’s heels is Charles Clough of Clough Capital Partners, with a $4.2 million position; 0.2% of its 13F portfolio is allocated to the stock. Other peers with similar optimism include Ken Griffin’s Citadel Investment Group, Chuck Royce’s Royce & Associates and Brian Taylor’s Pine River Capital Management.

As industrywide interest jumped, specific money managers were leading the bulls’ herd. Clough Capital Partners, managed by Charles Clough, created the most valuable position in Rda Microelectronics Inc (ADR) (NASDAQ:RDA). Clough Capital Partners had 4.2 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $3.8 million position during the quarter. The following funds were also among the new RDA investors: Brian Taylor’s Pine River Capital Management, Paul Marshall and Ian Wace’s Marshall Wace LLP, and George Soros’s Soros Fund Management.

How are insiders trading Rda Microelectronics Inc (ADR) (NASDAQ:RDA)?

Insider purchases made by high-level executives is most useful when the company we’re looking at has seen transactions within the past six months. Over the last six-month time frame, Rda Microelectronics Inc (ADR) (NASDAQ:RDA) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

With the results exhibited by the aforementioned strategies, everyday investors must always monitor hedge fund and insider trading activity, and Rda Microelectronics Inc (ADR) (NASDAQ:RDA) is an important part of this process.

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