Is CNO Financial Group Inc (NYSE:CNO) a healthy stock for your portfolio? The best stock pickers are in a pessimistic mood. The number of bullish hedge fund positions stayed the same which is a slightly negative development in our experience
If you’d ask most traders, hedge funds are assumed to be unimportant, outdated financial tools of yesteryear. While there are more than 8000 funds with their doors open at present, we at Insider Monkey hone in on the bigwigs of this club, close to 450 funds. It is estimated that this group controls the majority of the hedge fund industry’s total asset base, and by monitoring their top picks, we have come up with a few investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per year 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 topped the S&P 500 index by 23.3 percentage points in 8 months (check out a sample of our picks).
Equally as important, optimistic insider trading activity is a second way to parse down the financial markets. As the old adage goes: there are a number of motivations for an insider to sell shares of his or her company, but only one, very clear reason why they would behave bullishly. Various empirical studies have demonstrated the market-beating potential of this tactic if “monkeys” know where to look (learn more here).
Keeping this in mind, it’s important to take a gander at the latest action surrounding CNO Financial Group Inc (NYSE:CNO).
How have hedgies been trading CNO Financial Group Inc (NYSE:CNO)?
In preparation for this quarter, a total of 20 of the hedge funds we track were long in this stock, a change of 0% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their holdings meaningfully.
According to our comprehensive database, Paulson & Co, managed by John Paulson, holds the most valuable position in CNO Financial Group Inc (NYSE:CNO). Paulson & Co has a $154.4 million position in the stock, comprising 0.9% of its 13F portfolio. On Paulson & Co’s heels is Renaissance Technologies, managed by Jim Simons, which held a $21.3 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other peers that are bullish include Roger Keith Long’s Otter Creek Management, Anand Parekh’s Alyeska Investment Group and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
Since CNO Financial Group Inc (NYSE:CNO) has witnessed bearish sentiment from the smart money, it’s easy to see that there is a sect of money managers that elected to cut their positions entirely last quarter. It’s worth mentioning that SAC Subsidiary’s CR Intrinsic Investors dropped the largest investment of all the hedgies we key on, worth about $0.9 million in stock.. Matthew Tewksbury’s fund, Stevens Capital Management, also said goodbye to its stock, about $0.3 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
What do corporate executives and insiders think about CNO Financial Group Inc (NYSE:CNO)?
Insider trading activity, especially when it’s bullish, is best served when the primary stock in question has seen transactions within the past six months. Over the latest half-year time period, CNO Financial Group Inc (NYSE:CNO) has seen zero unique insiders purchasing, and 9 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 CNO Financial Group Inc (NYSE:CNO). These stocks are Triple-S Management Corp.(NYSE:GTS), PICO Holdings Inc (NASDAQ:PICO), Unum Group (NYSE:UNM), Assurant, Inc. (NYSE:AIZ), and StanCorp Financial Group, Inc. (NYSE:SFG). All of these stocks are in the accident & health insurance industry and their market caps resemble CNO’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Triple-S Management Corp.(NYSE:GTS) | 9 | 0 | 0 |
| PICO Holdings Inc (NASDAQ:PICO) | 8 | 0 | 0 |
| Unum Group (NYSE:UNM) | 15 | 0 | 6 |
| Assurant, Inc. (NYSE:AIZ) | 16 | 0 | 4 |
| StanCorp Financial Group, Inc. (NYSE:SFG) | 7 | 0 | 6 |
With the results demonstrated by our strategies, everyday investors must always keep an eye on hedge fund and insider trading activity, and CNO Financial Group Inc (NYSE:CNO) is an important part of this process.
