According to most market participants, hedge funds are seen as worthless, old investment tools of years past. While there are greater than 8000 funds with their doors open at the moment, we at Insider Monkey hone in on the upper echelon of this group, about 450 funds. It is estimated that this group oversees the lion’s share of the smart money’s total asset base, and by keeping an eye on their highest performing stock picks, we have determined a number of investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year 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 beaten the S&P 500 index by 25 percentage points in 6.5 month (see all of our picks from August).
Equally as important, optimistic insider trading activity is a second way to break down the investments you’re interested in. Just as you’d expect, there are many stimuli for a bullish insider to sell shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Various empirical studies have demonstrated the impressive potential of this method if shareholders know where to look (learn more here).
With all of this in mind, let’s take a glance at the recent action surrounding Cablevision Systems Corporation (NYSE:CVC).
How have hedgies been trading Cablevision Systems Corporation (NYSE:CVC)?
At year’s end, a total of 16 of the hedge funds we track were bullish in this stock, a change of -36% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their holdings considerably.
When looking at the hedgies we track, John Paulson’s Paulson & Co had the most valuable position in Cablevision Systems Corporation (NYSE:CVC), worth close to $181 million, comprising 1.1% of its total 13F portfolio. The second largest stake is held by Mario Gabelli of GAMCO Investors, with a $145 million position; 0.9% of its 13F portfolio is allocated to the company. Remaining hedgies that hold long positions include Steven Cohen’s SAC Capital Advisors, D. E. Shaw’s D E Shaw and Larry Foley and Paul Farrell’s Bronson Point Partners.
Seeing as Cablevision Systems Corporation (NYSE:CVC) has experienced bearish sentiment from the smart money, we can see that there were a few hedgies that elected to cut their full holdings in Q4. Intriguingly, Robert Pitts’s Steadfast Capital Management dropped the biggest position of the “upper crust” of funds we track, comprising close to $74 million in stock., and John Thaler of JAT Capital Management was right behind this move, as the fund dumped about $11 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 9 funds in Q4.
How have insiders been trading Cablevision Systems Corporation (NYSE:CVC)?
Bullish insider trading is particularly usable when the primary stock in question has experienced transactions within the past 180 days. Over the latest half-year time frame, Cablevision Systems Corporation (NYSE:CVC) has seen zero unique insiders buying, and 3 insider sales (see the details of insider trades here).
With the results demonstrated by the aforementioned studies, retail investors should always monitor hedge fund and insider trading activity, and Cablevision Systems Corporation (NYSE:CVC) shareholders fit into this picture quite nicely.
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