Nomura Holdings, Inc. (ADR) (NYSE:NMR) was in 8 hedge funds’ portfolio at the end of March. NMR has experienced an increase in support from the world’s most elite money managers lately. There were 5 hedge funds in our database with NMR positions at the end of the previous quarter.
According to most investors, hedge funds are seen as worthless, old financial tools of yesteryear. While there are more than 8000 funds with their doors open at present, we at Insider Monkey look at the moguls of this group, close to 450 funds. Most estimates calculate that this group has its hands on the lion’s share of the smart money’s total capital, and by keeping an eye on their top stock picks, we have found a number of investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per year 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 trumped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Just as beneficial, positive insider trading activity is a second way to parse down the marketplace. Obviously, there are a number of incentives for an insider to cut 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 strategy if shareholders know where to look (learn more here).
Keeping this in mind, let’s take a gander at the latest action regarding Nomura Holdings, Inc. (ADR) (NYSE:NMR).
How are hedge funds trading Nomura Holdings, Inc. (ADR) (NYSE:NMR)?
At the end of the first quarter, a total of 8 of the hedge funds we track held long positions in this stock, a change of 60% from the previous quarter. With the smart money’s capital changing hands, there exists a few key hedge fund managers who were boosting their stakes meaningfully.
Of the funds we track, Dreman Value Management, managed by David Dreman, holds the biggest position in Nomura Holdings, Inc. (ADR) (NYSE:NMR). Dreman Value Management has a $5.3 million position in the stock, comprising 0.1% of its 13F portfolio. On Dreman Value Management’s heels is D E Shaw, managed by D. E. Shaw, which held a $4.6 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other peers with similar optimism include Ken Griffin’s Citadel Investment Group, Charles Davidson’s Wexford Capital and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. Citadel Investment Group, managed by Ken Griffin, established the most valuable position in Nomura Holdings, Inc. (ADR) (NYSE:NMR). Citadel Investment Group had 1.5 million invested in the company at the end of the quarter. Charles Davidson’s Wexford Capital also initiated a $0.9 million position during the quarter. The following funds were also among the new NMR investors: Jim Simons’s Renaissance Technologies and Matthew Tewksbury’s Stevens Capital Management.
What do corporate executives and insiders think about Nomura Holdings, Inc. (ADR) (NYSE:NMR)?
Insider purchases made by high-level executives is best served when the company in question has seen transactions within the past 180 days. Over the last half-year time period, Nomura Holdings, Inc. (ADR) (NYSE:NMR) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Nomura Holdings, Inc. (ADR) (NYSE:NMR). These stocks are LPL Financial Holdings Inc (NASDAQ:LPLA), TD Ameritrade Holding Corp. (NYSE:AMTD), Morgan Stanley (NYSE:MS), CME Group Inc (NASDAQ:CME), and Charles Schwab Corp (NYSE:SCHW). All of these stocks are in the investment brokerage – national industry and their market caps resemble NMR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| LPL Financial Holdings Inc (NASDAQ:LPLA) | 14 | 0 | 5 |
| TD Ameritrade Holding Corp. (NYSE:AMTD) | 18 | 2 | 7 |
| Morgan Stanley (NYSE:MS) | 61 | 0 | 4 |
| CME Group Inc (NASDAQ:CME) | 30 | 0 | 10 |
| Charles Schwab Corp (NYSE:SCHW) | 32 | 0 | 9 |
With the results exhibited by the aforementioned studies, everyday investors must always monitor hedge fund and insider trading sentiment, and Nomura Holdings, Inc. (ADR) (NYSE:NMR) shareholders fit into this picture quite nicely.
