DDR Corp (DDR): Are Hedge Funds Right About This Stock?

DDR Corp (NYSE:DDR) was in 11 hedge funds’ portfolio at the end of the first quarter of 2013. DDR shareholders have witnessed a decrease in activity from the world’s largest hedge funds of late. There were 11 hedge funds in our database with DDR positions at the end of the previous quarter.

To the average investor, there are many metrics investors can use to watch the equity markets. Two of the most useful are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top hedge fund managers can outpace the broader indices by a very impressive margin (see just how much).

Equally as key, positive insider trading activity is a second way to parse down the investments you’re interested in. Just as you’d expect, there are a number of stimuli for a bullish insider to drop shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many empirical studies have demonstrated the valuable potential of this method if investors know what to do (learn more here).

With these “truths” under our belt, let’s take a gander at the latest action surrounding DDR Corp (NYSE:DDR).

How are hedge funds trading DDR Corp (NYSE:DDR)?

At Q1’s end, a total of 11 of the hedge funds we track were bullish in this stock, a change of 0% from the first quarter. With hedge funds’ capital changing hands, there exists a few notable hedge fund managers who were upping their stakes considerably.

Of the funds we track, AEW Capital Management, managed by Jeffrey Furber, holds the largest position in DDR Corp (NYSE:DDR). AEW Capital Management has a $66.8 million position in the stock, comprising 1.7% of its 13F portfolio. Coming in second is Blue Mountain Capital, managed by Andrew Feldstein and Stephen Siderow, which held a $17.8 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Remaining hedgies with similar optimism include Ken Griffin’s Citadel Investment Group, Israel Englander’s Millennium Management and Dmitry Balyasny’s Balyasny Asset Management.

Since DDR Corp (NYSE:DDR) has faced a declination in interest from the smart money, it’s easy to see that there lies a certain “tier” of hedge funds who were dropping their full holdings at the end of the first quarter. Intriguingly, Jeffrey Furber’s AEW Capital Management cut the biggest stake of the 450+ funds we watch, comprising close to $64.2 million in stock., and Matthew Tewksbury of Stevens Capital Management was right behind this move, as the fund dumped about $2.6 million worth. These moves are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

How have insiders been trading DDR Corp (NYSE:DDR)?

Bullish insider trading is most useful when the company in question has experienced transactions within the past 180 days. Over the last 180-day time frame, DDR Corp (NYSE:DDR) has experienced zero unique insiders purchasing, and 6 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to DDR Corp (NYSE:DDR). These stocks are SL Green Realty Corp (NYSE:SLG), Weingarten Realty Investors (NYSE:WRI), Federal Realty Investment Trust (NYSE:FRT), Regency Centers Corp (NYSE:REG), and Taubman Centers, Inc. (NYSE:TCO). This group of stocks belong to the reit – retail industry and their market caps are similar to DDR’s market cap.

With the results exhibited by our research, retail investors should always pay attention to hedge fund and insider trading sentiment, and DDR Corp (NYSE:DDR) is an important part of this process.

Click here to learn why you should track hedge funds