Hartford Financial Services Group Inc (NYSE:HIG) was in 46 hedge funds’ portfolio at the end of the fourth quarter of 2012. HIG has experienced a decrease in hedge fund sentiment recently. There were 46 hedge funds in our database with HIG positions at the end of the previous quarter. At the same time, Drexel Hamilton has announced today about upgrading Hartford Financial Services Group Inc (NYSE:HIG).
According to most investors, hedge funds are viewed as worthless, outdated financial tools of years past. While there are more than 8000 funds with their doors open today, we at Insider Monkey choose to focus on the bigwigs of this group, close to 450 funds. It is estimated that this group has its hands on most of the hedge fund industry’s total asset base, and by keeping an eye on their top investments, we have discovered a few investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy beat 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 outperformed the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).
Just as important, bullish insider trading sentiment is another way to break down the investments you’re interested in. Just as you’d expect, there are a variety of reasons for an insider to drop shares of his or her company, but only one, very clear reason why they would buy. Several empirical studies have demonstrated the valuable potential of this tactic if investors know where to look (learn more here).
Consequently, it’s important to take a glance at the recent action encompassing Hartford Financial Services Group Inc (NYSE:HIG).
What have hedge funds been doing with Hartford Financial Services Group Inc (NYSE:HIG)?
In preparation for this year, a total of 46 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were increasing their holdings considerably.
Of the funds we track, Paulson & Co, managed by John Paulson, holds the largest position in Hartford Financial Services Group Inc (NYSE:HIG). Paulson & Co has a $409.6 million position in the stock, comprising 2.5% of its 13F portfolio. On Paulson & Co’s heels is Ric Dillon of Diamond Hill Capital, with a $261 million position; the fund has 3% of its 13F portfolio invested in the stock. Other hedge funds with similar optimism include Steven Richman’s East Side Capital (RR Partners), David Tepper’s Appaloosa Management LP and Ken Griffin’s Citadel Investment Group.
Seeing as Hartford Financial Services Group Inc (NYSE:HIG) has experienced bearish sentiment from hedge fund managers, logic holds that there exists a select few hedge funds who sold off their full holdings at the end of the year. Interestingly, Andreas Halvorsen’s Viking Global dropped the biggest position of all the hedgies we watch, totaling close to $47.6 million in stock.. Joe DiMenna’s fund, ZWEIG DIMENNA PARTNERS, also sold off its stock, about $21 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
Insider trading activity in Hartford Financial Services Group Inc (NYSE:HIG)
Bullish insider trading is particularly usable when the primary stock in question has seen transactions within the past 180 days. Over the last six-month time period, Hartford Financial Services Group Inc (NYSE:HIG) has experienced 1 unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Hartford Financial Services Group Inc (NYSE:HIG). These stocks are Cincinnati Financial Corporation (NASDAQ:CINF), Everest Re Group Ltd (NYSE:RE), The Progressive Corporation (NYSE:PGR), Cna Financial Corp (NYSE:CNA), and XL Group plc (NYSE:XL). All of these stocks are in the property & casualty insurance industry and their market caps are closest to HIG’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Cincinnati Financial Corporation (NASDAQ:CINF) | 15 | 1 | 0 |
| Everest Re Group Ltd (NYSE:RE) | 18 | 0 | 2 |
| The Progressive Corporation (NYSE:PGR) | 17 | 0 | 3 |
| Cna Financial Corp (NYSE:CNA) | 14 | 0 | 2 |
| XL Group plc (NYSE:XL) | 23 | 0 | 2 |
With the returns exhibited by our studies, everyday investors should always monitor hedge fund and insider trading sentiment, and Hartford Financial Services Group Inc (NYSE:HIG) shareholders fit into this picture quite nicely.
