Home Loan Servicing Solutions Ltd (NASDAQ:HLSS) shareholders have witnessed an increase in hedge fund interest lately.
To most traders, hedge funds are seen as worthless, outdated investment vehicles of years past. While there are greater than 8000 funds in operation today, we at Insider Monkey hone in on the top tier of this club, around 450 funds. It is widely believed that this group oversees the lion’s share of all hedge funds’ total capital, and by watching their highest performing picks, we have unearthed a number of investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum 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 outpaced the S&P 500 index by 25 percentage points in 6.5 month (see all of our picks from August).
Just as key, bullish insider trading sentiment is another way to parse down the marketplace. Just as you’d expect, there are a variety of reasons for an executive to downsize shares of his or her company, but just one, very clear reason why they would buy. Many academic studies have demonstrated the market-beating potential of this strategy if “monkeys” understand what to do (learn more here).
Consequently, it’s important to take a gander at the key action regarding Home Loan Servicing Solutions Ltd (NASDAQ:HLSS).
What have hedge funds been doing with Home Loan Servicing Solutions Ltd (NASDAQ:HLSS)?
Heading into 2013, a total of 21 of the hedge funds we track held long positions in this stock, a change of 50% from the previous quarter. With the smart money’s capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes considerably.
According to our comprehensive database, Brian Taylor’s Pine River Capital Management had the largest position in Home Loan Servicing Solutions Ltd (NASDAQ:HLSS), worth close to $48 million, accounting for 0.9% of its total 13F portfolio. On Pine River Capital Management’s heels is Millennium Management, managed by Israel Englander, which held a $46 million position; 0.7% of its 13F portfolio is allocated to the company. Some other hedge funds that hold long positions include Ken Griffin’s Citadel Investment Group, Anand Parekh’s Alyeska Investment Group and Steven Cohen’s SAC Capital Advisors.
As one would reasonably expect, some big names were breaking ground themselves. Magnetar Capital, managed by Alec Litowitz and Ross Laser, initiated the largest position in Home Loan Servicing Solutions Ltd (NASDAQ:HLSS). Magnetar Capital had 15 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also made a $7 million investment in the stock during the quarter. The following funds were also among the new HLSS investors: Louis Bacon’s Moore Global Investments, Cliff Asness’s AQR Capital Management, and J. Alan Reid, Jr.’s Forward Management.
How are insiders trading Home Loan Servicing Solutions Ltd (NASDAQ:HLSS)?
Insider trading activity, especially when it’s bullish, is most useful when the company we’re looking at has experienced transactions within the past 180 days. Over the latest six-month time period, Home Loan Servicing Solutions Ltd (NASDAQ:HLSS) has experienced 4 unique insiders buying, and zero insider sales (see the details of insider trades here).
With the results demonstrated by Insider Monkey’s strategies, everyday investors must always monitor hedge fund and insider trading sentiment, and Home Loan Servicing Solutions Ltd (NASDAQ:HLSS) shareholders fit into this picture quite nicely.
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