If you’d ask most traders, hedge funds are assumed to be underperforming, outdated investment tools of yesteryear. While there are greater than 8000 funds in operation at present, we hone in on the crème de la crème of this club, around 450 funds. It is widely believed that this group oversees the lion’s share of all hedge funds’ total asset base, and by paying attention to their top picks, we have deciphered a few investment strategies that have historically outstripped the S&P 500 index. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points annually 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 topped the S&P 500 index by 23.3 percentage points in 8 months (explore the details and some picks here).
Equally as integral, bullish insider trading sentiment is a second way to break down the investments you’re interested in. As the old adage goes: there are lots of motivations for a bullish insider to downsize shares of his or her company, but just one, very clear reason why they would behave bullishly. Plenty of empirical studies have demonstrated the valuable potential of this strategy if shareholders know where to look (learn more here).
With all of this in mind, let’s take a gander at the latest action surrounding Chevron Corporation (NYSE:CVX).
What have hedge funds been doing with Chevron Corporation (NYSE:CVX)?
In preparation for this quarter, a total of 43 of the hedge funds we track held long positions in this stock, a change of -2% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings meaningfully.
According to our comprehensive database, Fisher Asset Management, managed by Ken Fisher, holds the largest position in Chevron Corporation (NYSE:CVX). Fisher Asset Management has a $426.7 million position in the stock, comprising 1.1% of its 13F portfolio. The second largest stake is held by Phill Gross and Robert Atchinson of Adage Capital Management, with a $326.5 million position; 1.1% of its 13F portfolio is allocated to the company. Remaining hedgies that are bullish include Cliff Asness’s AQR Capital Management, D. E. Shaw’s D E Shaw and Bill Miller’s Legg Mason Capital Management.
Judging by the fact that Chevron Corporation (NYSE:CVX) has experienced falling interest from hedge fund managers, logic holds that there exists a select few money managers that decided to sell off their entire stakes last quarter. Interestingly, Daniel S. Och’s OZ Management dropped the biggest investment of all the hedgies we key on, valued at about $32.8 million in stock., and David Costen Haley of HBK Investments was right behind this move, as the fund said goodbye to about $21.8 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 1 funds last quarter.
What have insiders been doing with Chevron Corporation (NYSE:CVX)?
Bullish insider trading is particularly usable when the company in focus has experienced transactions within the past 180 days. Over the latest half-year time period, Chevron Corporation (NYSE:CVX) has seen 1 unique insiders purchasing, and 3 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Chevron Corporation (NYSE:CVX). These stocks are TOTAL S.A. (ADR) (NYSE:TOT), Exxon Mobil Corporation (NYSE:XOM), BP plc (ADR) (NYSE:BP) and PetroChina Company Limited (ADR) (NYSE:PTR). All of these stocks are in the major integrated oil & gas industry and their market caps are closest to CVX’s market cap.
