Monolithic Power Systems, Inc. (NASDAQ:MPWR) was in 7 hedge funds’ portfolio at the end of December. MPWR has seen a decrease in hedge fund sentiment recently. There were 7 hedge funds in our database with MPWR positions at the end of the previous quarter.
In the eyes of most shareholders, hedge funds are assumed to be underperforming, old financial vehicles of yesteryear. While there are over 8000 funds with their doors open today, we at Insider Monkey hone in on the elite of this group, about 450 funds. It is estimated that this group has its hands on the majority of the smart money’s total capital, and by watching their best picks, we have figured out a number of investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per 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 topped the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).
Just as important, positive insider trading sentiment is another way to break down the stock market universe. There are plenty of reasons for a corporate insider to drop shares of his or her company, but only one, very obvious reason why they would behave bullishly. Various academic studies have demonstrated the valuable potential of this tactic if piggybackers know what to do (learn more here).
Consequently, we’re going to take a glance at the key action surrounding Monolithic Power Systems, Inc. (NASDAQ:MPWR).
What does the smart money think about Monolithic Power Systems, Inc. (NASDAQ:MPWR)?
Heading into 2013, a total of 7 of the hedge funds we track were long in this stock, a change of 0% from the third 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.
Of the funds we track, Donald Chiboucis’s Columbus Circle Investors had the biggest position in Monolithic Power Systems, Inc. (NASDAQ:MPWR), worth close to $37.5 million, comprising 0.3% of its total 13F portfolio. Sitting at the No. 2 spot is Phill Gross and Robert Atchinson of Adage Capital Management, with a $26.2 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedgies that are bullish include Ken Griffin’s Citadel Investment Group, Clint Carlson’s Carlson Capital and James Dondero’s Highland Capital Management.
Because Monolithic Power Systems, Inc. (NASDAQ:MPWR) has witnessed falling interest from the smart money, it’s easy to see that there lies a certain “tier” of hedge funds that slashed their entire stakes in Q4. Interestingly, Paul Tudor Jones’s Tudor Investment Corp dumped the largest investment of the “upper crust” of funds we key on, totaling an estimated $0.3 million in stock. These transactions are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
What do corporate executives and insiders think about Monolithic Power Systems, Inc. (NASDAQ:MPWR)?
Insider buying is best served when the company in focus has experienced transactions within the past half-year. Over the latest six-month time period, Monolithic Power Systems, Inc. (NASDAQ:MPWR) has seen zero unique insiders purchasing, and 11 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Monolithic Power Systems, Inc. (NASDAQ:MPWR). These stocks are SolarCity Corp (NASDAQ:SCTY), JA Solar Holdings Co., Ltd. (ADR) (NASDAQ:JASO), Magnachip Semiconductor Corp (NYSE:MX), Lattice Semiconductor (NASDAQ:LSCC), and Himax Technologies, Inc. (ADR) (NASDAQ:HIMX). This group of stocks belong to the semiconductor – specialized industry and their market caps match MPWR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| SolarCity Corp (NASDAQ:SCTY) | 7 | 4 | 2 |
| JA Solar Holdings Co., Ltd. (ADR) (NASDAQ:JASO) | 3 | 0 | 0 |
| Magnachip Semiconductor Corp (NYSE:MX) | 15 | 0 | 2 |
| Lattice Semiconductor (NASDAQ:LSCC) | 13 | 0 | 1 |
| Himax Technologies, Inc. (ADR) (NASDAQ:HIMX) | 6 | 0 | 0 |
With the results shown by our time-tested strategies, everyday investors must always pay attention to hedge fund and insider trading activity, and Monolithic Power Systems, Inc. (NASDAQ:MPWR) is no exception.
