Hedge Funds Are Betting On Tronox Ltd (TROX)

Tronox Ltd (NYSE:TROX) was in 35 hedge funds’ portfolio at the end of the first quarter of 2013. TROX shareholders have witnessed an increase in activity from the world’s largest hedge funds in recent months. There were 29 hedge funds in our database with TROX holdings at the end of the previous quarter.

In the 21st century investor’s toolkit, there are tons of indicators investors can use to track Mr. Market. A duo of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite money managers can beat the broader indices by a superb amount (see just how much).

Just as key, optimistic insider trading sentiment is another way to break down the investments you’re interested in. As the old adage goes: there are many incentives for an upper level exec to downsize shares of his or her company, but just one, very simple reason why they would buy. Many academic studies have demonstrated the market-beating potential of this tactic if piggybackers understand what to do (learn more here).

Now, let’s take a glance at the key action encompassing Tronox Ltd (NYSE:TROX).

How are hedge funds trading Tronox Ltd (NYSE:TROX)?

Heading into Q2, a total of 35 of the hedge funds we track held long positions in this stock, a change of 21% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were increasing their stakes significantly.

When looking at the hedgies we track, Jeffrey Gates’s Gates Capital Management had the biggest position in Tronox Ltd (NYSE:TROX), worth close to $95.2 million, comprising 5% of its total 13F portfolio. The second largest stake is held by Marc Lasry of Avenue Capital, with a $44.2 million position; the fund has 7.6% of its 13F portfolio invested in the stock. Remaining hedge funds that are bullish include Debra Fine’s Fine Capital Partners, Jonathan Savitz’s Greywolf Capital Management and Craig C. Albert’s Sheffield Asset Management.

Now, some big names were breaking ground themselves. Sheffield Asset Management, managed by Craig C. Albert, created the largest position in Tronox Ltd (NYSE:TROX). Sheffield Asset Management had 18.7 million invested in the company at the end of the quarter. Clint Carlson’s Carlson Capital also initiated a $8.4 million position during the quarter. The other funds with brand new TROX positions are Ken Griffin’s Citadel Investment Group, Meridee A. Moore’s Watershed Asset Management, and John Murphy’s Alydar Capital.

What do corporate executives and insiders think about Tronox Ltd (NYSE:TROX)?

Insider buying is most useful when the company in question has seen transactions within the past 180 days. Over the last six-month time period, Tronox Ltd (NYSE:TROX) has experienced 1 unique insiders buying, and zero 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 Tronox Ltd (NYSE:TROX). These stocks are GSE Holding Inc (NYSE:GSE), Hawkins, Inc. (NASDAQ:HWKN), Axiall Corp (NYSE:AXLL), and Minerals Technologies Inc (NYSE:MTX). All of these stocks are in the synthetics industry and their market caps are similar to TROX’s market cap.