Hedge Funds Are Selling IDEX Corporation (IEX) – Nordson Corporation (NDSN), Colfax Corp (CFX)

IDEX Corporation (NYSE:IEX) was in 10 hedge funds’ portfolio at the end of December. IEX has experienced a decrease in hedge fund sentiment of late. There were 14 hedge funds in our database with IEX holdings at the end of the previous quarter.

In today’s marketplace, there are tons of gauges market participants can use to track publicly traded companies. Two of the best are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top money managers can outpace the S&P 500 by a healthy margin (see just how much).

Equally as integral, bullish insider trading activity is another way to parse down the world of equities. As the old adage goes: there are a number of stimuli for an insider to cut shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Many academic studies have demonstrated the valuable potential of this strategy if shareholders understand what to do (learn more here).

Consequently, it’s important to take a look at the recent action encompassing IDEX Corporation (NYSE:IEX).

How are hedge funds trading IDEX Corporation (NYSE:IEX)?

In preparation for this year, a total of 10 of the hedge funds we track held long positions in this stock, a change of -29% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes significantly.

Of the funds we track, Ariel Investments, managed by John W. Rogers, holds the largest position in IDEX Corporation (NYSE:IEX). Ariel Investments has a $68 million position in the stock, comprising 1.4% of its 13F portfolio. Sitting at the No. 2 spot is GAMCO Investors, managed by Mario Gabelli, which held a $66 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Other peers that are bullish include Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Chuck Royce’s Royce & Associates and Matthew Lindenbaum’s Basswood Capital.

Since IDEX Corporation (NYSE:IEX) has experienced bearish sentiment from the aggregate hedge fund industry, we can see that there exists a select few fund managers that decided to sell off their positions entirely at the end of the year. Intriguingly, Robert Rodriguez and Steven Romick’s First Pacific Advisors LLC sold off the largest position of the 450+ funds we monitor, totaling about $32 million in stock.. Ken Gray and Steve Walsh’s fund, Bryn Mawr Capital, also cut its stock, about $11 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 4 funds at the end of the year.

How have insiders been trading IDEX Corporation (NYSE:IEX)?

Bullish insider trading is at its handiest when the company in question has experienced transactions within the past six months. Over the latest six-month time period, IDEX Corporation (NYSE:IEX) has seen zero unique insiders purchasing, and 4 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to IDEX Corporation (NYSE:IEX). These stocks are Xylem Inc (NYSE:XYL), Dresser-Rand Group Inc. (NYSE:DRC), Nordson Corporation (NASDAQ:NDSN), Avery Dennison Corp (NYSE:AVY), and Colfax Corp (NYSE:CFX). This group of stocks are in the diversified machinery industry and their market caps are closest to IEX’s market cap.

With the returns shown by the aforementioned strategies, everyday investors should always monitor hedge fund and insider trading activity, and IDEX Corporation (NYSE:IEX) shareholders fit into this picture quite nicely.

Click here to learn why you should track hedge funds