General Mills, Inc. (NYSE:GIS) shareholders have witnessed a decrease in hedge fund sentiment in recent months.
According to most traders, hedge funds are viewed as underperforming, old financial vehicles of yesteryear. While there are more than 8000 funds with their doors open today, we at Insider Monkey hone in on the crème de la crème of this group, about 450 funds. Most estimates calculate that this group oversees most of the smart money’s total capital, and by tracking their highest performing stock picks, we have deciphered a few investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum 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 outpaced the S&P 500 index by 25 percentage points in 6.5 month (see the details here).
Equally as beneficial, optimistic insider trading activity is another way to break down the world of equities. There are a variety of incentives for an upper level exec to sell shares of his or her company, but just one, very obvious reason why they would buy. Many academic studies have demonstrated the useful potential of this method if shareholders understand what to do (learn more here).
Now, it’s important to take a glance at the recent action surrounding General Mills, Inc. (NYSE:GIS).
What have hedge funds been doing with General Mills, Inc. (NYSE:GIS)?
In preparation for this year, a total of 24 of the hedge funds we track held long positions in this stock, a change of -4% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their holdings substantially.
Of the funds we track, Ric Dillon’s Diamond Hill Capital had the largest position in General Mills, Inc. (NYSE:GIS), worth close to $150 million, accounting for 1.7% of its total 13F portfolio. On Diamond Hill Capital’s heels is GAMCO Investors, managed by Mario Gabelli, which held a $117 million position; 0.6% of its 13F portfolio is allocated to the company. Other hedgies that hold long positions include Phill Gross and Robert Atchinson’s Adage Capital Management, Cliff Asness’s AQR Capital Management and Ken Griffin’s Citadel Investment Group.
Since General Mills, Inc. (NYSE:GIS) has faced a declination in interest from the entirety of the hedge funds we track, it’s safe to say that there lies a certain “tier” of hedgies that decided to sell off their entire stakes heading into 2013. Interestingly, Israel Englander’s Millennium Management said goodbye to the largest position of the “upper crust” of funds we key on, worth about $3 million in stock., and D. E. Shaw of D E Shaw was right behind this move, as the fund sold off about $2 million worth. These transactions are intriguing to say the least, as total hedge fund interest dropped by 1 funds heading into 2013.
How have insiders been trading General Mills, Inc. (NYSE:GIS)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company we’re looking at has experienced transactions within the past half-year. Over the last half-year time frame, General Mills, Inc. (NYSE:GIS) has seen zero unique insiders buying, and 11 insider sales (see the details of insider trades here).
With the returns shown by our tactics, retail investors must always pay attention to hedge fund and insider trading sentiment, and General Mills, Inc. (NYSE:GIS) shareholders fit into this picture quite nicely.
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