Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B) was in 10 hedge funds’ portfolio at the end of the first quarter of 2013. EBR investors should be aware of an increase in enthusiasm from smart money recently. There were 9 hedge funds in our database with EBR positions at the end of the previous quarter.
In the 21st century investor’s toolkit, there are a multitude of indicators shareholders can use to analyze the equity markets. A pair of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite investment managers can outpace the market by a solid amount (see just how much).
Equally as key, bullish insider trading activity is another way to break down the world of equities. Obviously, there are a number of stimuli for an insider to get rid of shares of his or her company, but only one, very simple reason why they would initiate a purchase. Various empirical studies have demonstrated the useful potential of this strategy if you know what to do (learn more here).
Now, it’s important to take a gander at the latest action surrounding Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B).
How are hedge funds trading Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B)?
At the end of the first quarter, a total of 10 of the hedge funds we track were long in this stock, a change of 11% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their holdings significantly.
Of the funds we track, Vinik Asset Management, managed by Jeffrey Vinik, holds the largest position in Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B). Vinik Asset Management has a $17.9 million position in the stock, comprising 0.5% of its 13F portfolio. Coming in second is Jim Simons of Renaissance Technologies, with a $1.5 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other hedgies that hold long positions include David Costen Haley’s HBK Investments, Glenn Russell Dubin’s Highbridge Capital Management and Ken Griffin’s Citadel Investment Group.
With a general bullishness amongst the heavyweights, key money managers have jumped into Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B) headfirst. Highbridge Capital Management, managed by Glenn Russell Dubin, initiated the most outsized position in Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B). Highbridge Capital Management had 0.6 million invested in the company at the end of the quarter. Mike Vranos’s Ellington also made a $0.2 million investment in the stock during the quarter. The only other fund with a new position in the stock is Israel Englander’s Millennium Management.
How are insiders trading Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B)?
Insider trading activity, especially when it’s bullish, is most useful when the primary stock in question has experienced transactions within the past six months. Over the last six-month time period, Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B). These stocks are TECO Energy, Inc. (NYSE:TE), Brookfield Infrastructure Partners L.P. (NYSE:BIP), Companhia Paranaense de Energia (ADR) (NYSE:ELP), Pepco Holdings, Inc. (NYSE:POM), and ITC Holdings Corp. (NYSE:ITC). This group of stocks are in the electric utilities industry and their market caps are similar to EBR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| TECO Energy, Inc. (NYSE:TE) | 10 | 0 | 7 |
| Brookfield Infrastructure Partners L.P. (NYSE:BIP) | 4 | 0 | 0 |
| Companhia Paranaense de Energia (ADR) (NYSE:ELP) | 6 | 0 | 0 |
| Pepco Holdings, Inc. (NYSE:POM) | 6 | 0 | 1 |
| ITC Holdings Corp. (NYSE:ITC) | 14 | 0 | 4 |
With the returns demonstrated by our studies, retail investors should always pay attention to hedge fund and insider trading sentiment, and Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B) is no exception.
