Hedge Funds Are Buying SciQuest, Inc. (SQI)

SciQuest, Inc. (NASDAQ:SQI) has experienced an increase in activity from the world’s largest hedge funds in recent months.

At the moment, there are a multitude of methods investors can use to track stocks. A duo of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can outpace their index-focused peers by a healthy margin (see just how much).

Equally as beneficial, optimistic insider trading activity is a second way to break down the world of equities. Just as you’d expect, there are many motivations for an executive to downsize shares of his or her company, but just one, very clear reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the useful potential of this tactic if “monkeys” know where to look (learn more here).

Consequently, it’s important to take a gander at the recent action regarding SciQuest, Inc. (NASDAQ:SQI).

Hedge fund activity in SciQuest, Inc. (NASDAQ:SQI)

Heading into 2013, a total of 7 of the hedge funds we track held long positions in this stock, a change of 17% from the previous quarter. With hedge funds’ sentiment swirling, there exists a select group of notable hedge fund managers who were upping their holdings substantially.

According to our comprehensive database, Brian Ashford-Russell and Tim Woolley’s Polar Capital had the biggest position in SciQuest, Inc. (NASDAQ:SQI), worth close to $6 million, accounting for 0.3% of its total 13F portfolio. Sitting at the No. 2 spot is Jim Simons of Renaissance Technologies, with a $4.9 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other hedge funds that hold long positions include Richard Driehaus’s Driehaus Capital, Panayotis æTakisÆ Sparaggis’s Alkeon Capital Management and Israel Englander’s Millennium Management.

As aggregate interest increased, key hedge funds have been driving this bullishness. Millennium Management, managed by Israel Englander, assembled the largest position in SciQuest, Inc. (NASDAQ:SQI). Millennium Management had 0.5 million invested in the company at the end of the quarter.

What have insiders been doing with SciQuest, Inc. (NASDAQ:SQI)?

Insider buying is particularly usable when the company in focus has experienced transactions within the past half-year. Over the last 180-day time frame, SciQuest, Inc. (NASDAQ:SQI) has experienced zero unique insiders purchasing, and 2 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to SciQuest, Inc. (NASDAQ:SQI). These stocks are E2open Inc (NASDAQ:EOPN), AutoNavi Holdings Ltd (ADR) (NASDAQ:AMAP), Proofpoint Inc (NASDAQ:PFPT), Bazaarvoice Inc (NASDAQ:BV), and Accelrys, Inc. (NASDAQ:ACCL). All of these stocks are in the application software industry and their market caps are similar to SQI’s market cap.

With the results exhibited by Insider Monkey’s strategies, retail investors must always pay attention to hedge fund and insider trading sentiment, and SciQuest, Inc. (NASDAQ:SQI) is no exception.

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