Hedge Funds Are Buying Heidrick & Struggles International, Inc. (HSII)

Is Heidrick & Struggles International, Inc. (NASDAQ:HSII) going to take off soon? Investors who are in the know are buying. The number of bullish hedge fund positions inched up by 1 recently.

To most investors, hedge funds are perceived as slow, outdated financial tools of yesteryear. While there are over 8000 funds trading at present, we at Insider Monkey choose to focus on the top tier of this club, about 450 funds. Most estimates calculate that this group has its hands on most of the smart money’s total capital, and by monitoring their top equity investments, we have come up with a number of investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outperformed 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 trumped the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).

Equally as integral, positive insider trading sentiment is another way to break down the stock market universe. There are a number of stimuli for an executive to sell shares of his or her company, but just one, very simple reason why they would buy. Plenty of academic studies have demonstrated the impressive potential of this method if “monkeys” know where to look (learn more here).

With these “truths” under our belt, let’s take a peek at the recent action regarding Heidrick & Struggles International, Inc. (NASDAQ:HSII).

What have hedge funds been doing with Heidrick & Struggles International, Inc. (NASDAQ:HSII)?

In preparation for this year, a total of 9 of the hedge funds we track were bullish in this stock, a change of 13% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their stakes considerably.

Of the funds we track, Chuck Royce’s Royce & Associates had the biggest position in Heidrick & Struggles International, Inc. (NASDAQ:HSII), worth close to $8.4 million, accounting for less than 0.1%% of its total 13F portfolio. Sitting at the No. 2 spot is Renaissance Technologies, managed by Jim Simons, which held a $1.9 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Joel Greenblatt’s Gotham Asset Management, Ken Griffin’s Citadel Investment Group and John Overdeck and David Siegel’s Two Sigma Advisors.

Consequently, specific money managers have been driving this bullishness. Wexford Capital, managed by Charles Davidson, initiated the most outsized position in Heidrick & Struggles International, Inc. (NASDAQ:HSII). Wexford Capital had 0.2 million invested in the company at the end of the quarter.

How have insiders been trading Heidrick & Struggles International, Inc. (NASDAQ:HSII)?

Insider purchases made by high-level executives is particularly usable when the company in question has experienced transactions within the past 180 days. Over the latest half-year time period, Heidrick & Struggles International, Inc. (NASDAQ:HSII) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Heidrick & Struggles International, Inc. (NASDAQ:HSII). These stocks are Kforce Inc. (NASDAQ:KFRC), Hudson Global Inc (NASDAQ:HSON), Cross Country Healthcare, Inc. (NASDAQ:CCRN), Barrett Business Services, Inc. (NASDAQ:BBSI), and CDI Corp. (NYSE:CDI). This group of stocks are in the staffing & outsourcing services industry and their market caps are similar to HSII’s market cap.

With the results shown by Insider Monkey’s time-tested strategies, retail investors should always pay attention to hedge fund and insider trading activity, and Heidrick & Struggles International, Inc. (NASDAQ:HSII) applies perfectly to this mantra.

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