BroadSoft Inc (NASDAQ:BSFT) was in 10 hedge funds’ portfolio at the end of December. BSFT has experienced a decrease in enthusiasm from smart money recently. There were 11 hedge funds in our database with BSFT positions at the end of the previous quarter.
In today’s marketplace, there are tons of methods investors can use to monitor Mr. Market. A pair of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best money managers can trounce the broader indices by a solid amount (see just how much).
Equally as integral, bullish insider trading sentiment is a second way to parse down the financial markets. Just as you’d expect, there are plenty of incentives for an upper level exec to downsize shares of his or her company, but just one, very obvious reason why they would buy. Many empirical studies have demonstrated the useful potential of this method if investors know where to look (learn more here).
With these “truths” under our belt, let’s take a look at the key action surrounding BroadSoft Inc (NASDAQ:BSFT).
How are hedge funds trading BroadSoft Inc (NASDAQ:BSFT)?
At year’s end, a total of 10 of the hedge funds we track were bullish in this stock, a change of -9% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were increasing their stakes significantly.
When looking at the hedgies we track, Lee Hobson’s Highside Capital Management had the largest position in BroadSoft Inc (NASDAQ:BSFT), worth close to $23 million, comprising 2.5% of its total 13F portfolio. On Highside Capital Management’s heels is White Elm Capital, managed by Matthew Iorio, which held a $14 million position; 0% of its 13F portfolio is allocated to the company. Some other hedgies with similar optimism include Brian Ashford-Russell and Tim Woolley’s Polar Capital, Ken Griffin’s Citadel Investment Group and John Murphy’s Alydar Capital.
Due to the fact that BroadSoft Inc (NASDAQ:BSFT) has witnessed falling interest from hedge fund managers, we can see that there lies a certain “tier” of money managers who sold off their entire stakes in Q4. At the top of the heap, Donald Chiboucis’s Columbus Circle Investors sold off the largest investment of all the hedgies we key on, comprising about $22 million in stock., and Philip Hempleman of Ardsley Partners was right behind this move, as the fund dropped about $16 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 1 funds in Q4.
What have insiders been doing with BroadSoft Inc (NASDAQ:BSFT)?
Bullish insider trading is best served when the primary stock in question has experienced transactions within the past 180 days. Over the last six-month time period, BroadSoft Inc (NASDAQ:BSFT) has seen 1 unique insiders buying, and 3 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to BroadSoft Inc (NASDAQ:BSFT). These stocks are FleetMatics Group PLC (NYSE:FLTX), Lifelock Inc (NYSE:LOCK), Demandware Inc (NYSE:DWRE), AVG Technologies NV (NYSE:AVG), and PROS Holdings, Inc. (NYSE:PRO). This group of stocks are in the application software industry and their market caps match BSFT’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| FleetMatics Group PLC (NYSE:FLTX) | 2 | 0 | 0 |
| Lifelock Inc (NYSE:LOCK) | 9 | 1 | 2 |
| Demandware Inc (NYSE:DWRE) | 4 | 0 | 5 |
| AVG Technologies NV (NYSE:AVG) | 8 | 1 | 0 |
| PROS Holdings, Inc. (NYSE:PRO) | 5 | 0 | 2 |
With the returns demonstrated by our time-tested strategies, retail investors should always pay attention to hedge fund and insider trading activity, and BroadSoft Inc (NASDAQ:BSFT) shareholders fit into this picture quite nicely.
