According to most shareholders, hedge funds are viewed as unimportant, old investment vehicles of the past. While there are over 8000 funds in operation today, we choose to focus on the aristocrats of this group, close to 450 funds. Most estimates calculate that this group has its hands on the lion’s share of the hedge fund industry’s total capital, and by tracking their top stock picks, we have spotted a number of investment strategies that have historically outpaced the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 25 percentage points in 6.5 month (check out a sample of our picks).
Equally as integral, optimistic insider trading sentiment is a second way to parse down the investments you’re interested in. There are many reasons for an upper level exec to drop shares of his or her company, but only one, very clear reason why they would behave bullishly. Several academic studies have demonstrated the market-beating potential of this method if you know what to do (learn more here).
With all of this in mind, it’s important to take a gander at the recent action surrounding Hillenbrand, Inc. (NYSE:HI).
What have hedge funds been doing with Hillenbrand, Inc. (NYSE:HI)?
At the end of the fourth quarter, a total of 17 of the hedge funds we track were long in this stock, a change of 31% from the third quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were increasing their stakes meaningfully.
Of the funds we track, Diamond Hill Capital, managed by Ric Dillon, holds the largest position in Hillenbrand, Inc. (NYSE:HI). Diamond Hill Capital has a $21 million position in the stock, comprising 0.2% of its 13F portfolio. Sitting at the No. 2 spot is Dreman Value Management, managed by David Dreman, which held a $11 million position; 1.5% of its 13F portfolio is allocated to the stock. Some other hedge funds that hold long positions include D. E. Shaw’s D E Shaw, Ken Griffin’s Citadel Investment Group and Chuck Royce’s Royce & Associates.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls’ herd. Newland Capital, managed by Ken Brodkowitz and Mike Vermut, established the biggest position in Hillenbrand, Inc. (NYSE:HI). Newland Capital had 1 million invested in the company at the end of the quarter. Mike Vranos’s Ellington also made a $1 million investment in the stock during the quarter. The other funds with brand new HI positions are Glenn Russell Dubin’s Highbridge Capital Management, Ken Gray and Steve Walsh’s Bryn Mawr Capital, and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
Insider trading activity in Hillenbrand, Inc. (NYSE:HI)
Insider trading activity, especially when it’s bullish, is most useful when the company in question has seen transactions within the past six months. Over the latest 180-day time period, Hillenbrand, Inc. (NYSE:HI) has experienced 2 unique insiders purchasing, and 1 insider sales (see the details of insider trades here).
With the results shown by the aforementioned studies, retail investors must always monitor hedge fund and insider trading sentiment, and Hillenbrand, Inc. (NYSE:HI) is no exception.
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