Hedge Funds Are Crazy About Spectra Energy Corp. (SE)

In the eyes of many traders, hedge funds are viewed as delayed, outdated investment tools of a period lost to current times. Although there are more than 8,000 hedge funds trading in present day, this site aim at the crème de la crème of this group, about 525 funds. Analysts calculate that this group has its hands on the lion’s share of the hedge fund industry’s total capital, and by monitoring their highest quality stock picks, we’ve figured out a number of investment strategies that have historically outpaced the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).

Equally as useful, positive insider trading sentiment is a second way to analyze the financial markets. Obviously, there are a number of reasons for an executive to cut shares of his or her company, but just one, very clear reason why they would buy. Several empirical studies have demonstrated the useful potential of this tactic if investors understand what to do (learn more here).

Thus, we’re going to discuss the newest info for Spectra Energy Corp. (NYSE:SE).

How have hedgies been trading Spectra Energy Corp. (NYSE:SE)?

At Q2’s end, a total of 22 of the hedge funds we track were long in this stock, a change of 10% from one quarter earlier. With the smart money’s sentiment swirling, there exists a few key hedge fund managers who were upping their holdings meaningfully.

When using filings from the hedgies we track, York Capital Management, managed by James Dinan, holds the most valuable position in Spectra Energy Corp. (NYSE:SE). York Capital Management has a $145.3 million position in the stock, comprising 3% of its 13F portfolio. Coming in second is Israel Englander of Millennium Management, with a $89 million position; 0.3% of its 13F portfolio is allocated to the company. Other peers with similar optimism include Alec Litowitz and Ross Laser’s Magnetar Capital, Ken Griffin’s Citadel Investment Group and Tom Sandell’s Sandell Asset Management.

With a general bullishness amongst the titans, certain bigger names were breaking ground themselves. York Capital Management, managed by James Dinan, established the biggest position in Spectra Energy Corp. (NYSE:SE). York Capital Management had 145.3 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also initiated a $89 million position during the quarter. The other funds with brand new SE positions are Alec Litowitz and Ross Laser’s Magnetar Capital, Ken Griffin’s Citadel Investment Group, and Tom Sandell’s Sandell Asset Management.

How are insiders trading Spectra Energy Corp. (NYSE:SE)?

Insider buying made by high-level executives is at its handiest when the company in focus has experienced transactions within the past 180 days. Over the latest half-year time frame, Spectra Energy Corp. (NYSE:SE) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also examine the relationship between both of these indicators in other stocks similar to Spectra Energy Corp. (NYSE:SE). These stocks are Oneok Partners LP (NYSE:OKS), Energy Transfer Partners LP (NYSE:ETP), Energy Transfer Equity, L.P. (NYSE:ETE), Williams Companies, Inc. (NYSE:WMB), and Plains All American Pipeline, L.P. (NYSE:PAA). This group of stocks are in the oil & gas pipelines industry and their market caps match SE’s market cap.

Using the results shown by the previously mentioned analyses, average investors should always watch hedge fund and insider trading activity, and Spectra Energy Corp. (NYSE:SE) is no exception.

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