Do Hedge Funds and Insiders Love Olin Corporation (OLN)?

Olin Corporation (NYSE:OLN) was in 11 hedge funds’ portfolio at the end of March. OLN investors should be aware of a decrease in hedge fund interest in recent months. There were 15 hedge funds in our database with OLN holdings at the end of the previous quarter.

In the 21st century investor’s toolkit, there are plenty of gauges shareholders can use to monitor publicly traded companies. Two of the most under-the-radar are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite money managers can beat the S&P 500 by a solid amount (see just how much).

Just as key, bullish insider trading activity is a second way to parse down the marketplace. Obviously, there are lots of motivations for an executive to sell shares of his or her company, but only one, very simple reason why they would behave bullishly. Plenty of academic studies have demonstrated the market-beating potential of this strategy if you know what to do (learn more here).

Now, we’re going to take a look at the latest action encompassing Olin Corporation (NYSE:OLN).

How have hedgies been trading Olin Corporation (NYSE:OLN)?

At Q1’s end, a total of 11 of the hedge funds we track held long positions in this stock, a change of -27% from the first quarter. 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 substantially.

According to our comprehensive database, Dreman Value Management, managed by David Dreman, holds the largest position in Olin Corporation (NYSE:OLN). Dreman Value Management has a $34.6 million position in the stock, comprising 0.9% of its 13F portfolio. Sitting at the No. 2 spot is Citadel Investment Group, managed by Ken Griffin, which held a $7.9 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Some other peers with similar optimism include Israel Englander’s Catapult Capital Management, Mario Gabelli’s GAMCO Investors and Israel Englander’s Millennium Management.

Because Olin Corporation (NYSE:OLN) has faced declining sentiment from hedge fund managers, logic holds that there were a few hedge funds who were dropping their full holdings heading into Q2. At the top of the heap, Matthew Hulsizer’s PEAK6 Capital Management dumped the largest investment of the “upper crust” of funds we key on, worth an estimated $0.9 million in call options, and Alec Litowitz and Ross Laser of Magnetar Capital was right behind this move, as the fund said goodbye to about $0.7 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 4 funds heading into Q2.

Insider trading activity in Olin Corporation (NYSE:OLN)

Insider buying is most useful when the company in focus has experienced transactions within the past six months. Over the last six-month time frame, Olin Corporation (NYSE:OLN) has experienced 1 unique insiders purchasing, and 5 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Olin Corporation (NYSE:OLN). These stocks are Kronos Worldwide, Inc. (NYSE:KRO), Cabot Corp (NYSE:CBT), Chemtura Corp (NYSE:CHMT), Sensient Technologies Corporation (NYSE:SXT), and HB Fuller Co (NYSE:FUL). This group of stocks are the members of the specialty chemicals industry and their market caps are closest to OLN’s market cap.

With the results exhibited by the aforementioned strategies, retail investors must always pay attention to hedge fund and insider trading sentiment, and Olin Corporation (NYSE:OLN) shareholders fit into this picture quite nicely.

Click here to learn why you should track hedge funds