Hedge Funds Are Buying General Growth Properties Inc (GGP)

To many of your fellow readers, hedge funds are viewed as useless, old investment vehicles of a period lost to current times. Although there are In excess of 8,000 hedge funds trading currently, Insider Monkey looks at the masters of this club, around 525 funds. Analysts calculate that this group controls the majority of the smart money’s total assets, and by watching their best equity investments, we’ve unsheathed a number of investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 33 percentage points in 11 months (find a sample of our picks).

Equally as crucial, positive insider trading activity is another way to look at the marketplace. There are lots of reasons for a bullish insider to sell shares of his or her company, but just one, very clear reason why they would initiate a purchase. Several empirical studies have demonstrated the valuable potential of this strategy if shareholders understand where to look (learn more here).

Thus, we’re going to examine the latest info surrounding General Growth Properties Inc (NYSE:GGP).

How are hedge funds trading General Growth Properties Inc (NYSE:GGP)?

At the end of the second quarter, a total of 24 of the hedge funds we track were bullish in this stock, a change of 9% from the previous quarter. With hedgies’ sentiment swirling, there exists a few key hedge fund managers who were boosting their stakes substantially.

When using filings from the hedgies we track, Bill Ackman’s Pershing Square had the biggest position in General Growth Properties Inc (NYSE:GGP), worth close to $1.347 billion, comprising 12.3% of its total 13F portfolio. The second largest stake is held by Carlson Capital, managed by Clint Carlson, which held a $84.9 million position; the fund has 1% of its 13F portfolio invested in the stock. Other peers with similar optimism include Jim Simons’s Renaissance Technologies, Murray Stahl’s Horizon Asset Management and Ken Griffin’s Citadel Investment Group.

Consequently, certain money managers have been driving this bullishness. Pershing Square, managed by Bill Ackman, established the most outsized position in General Growth Properties Inc (NYSE:GGP). Pershing Square had 1.347 billion invested in the company at the end of the quarter. Clint Carlson’s Carlson Capital also initiated a $84.9 million position during the quarter. The other funds with new positions in the stock are Jim Simons’s Renaissance Technologies, Murray Stahl’s Horizon Asset Management, and Ken Griffin’s Citadel Investment Group.

Insider trading activity in General Growth Properties Inc (NYSE:GGP)

Insider buying made by high-level executives is particularly usable when the primary stock in question has experienced transactions within the past six months. Over the last six-month time period, General Growth Properties Inc (NYSE:GGP) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll go over the relationship between both of these indicators in other stocks similar to General Growth Properties Inc (NYSE:GGP). These stocks are Federal Realty Investment Trust (NYSE:FRT), SL Green Realty Corp (NYSE:SLG), Realty Income Corp (NYSE:O), Macerich Co (NYSE:MAC), and Kimco Realty Corp (NYSE:KIM). All of these stocks are in the reit – retail industry and their market caps are closest to GGP’s market cap.

Using the returns explained by the previously mentioned strategies, average investors must always track hedge fund and insider trading activity, and General Growth Properties Inc (NYSE:GGP) applies perfectly to this mantra.

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