According to most traders, hedge funds are seen as unimportant, outdated investment tools of yesteryear. While there are over 8000 funds trading today, we at Insider Monkey choose to focus on the top tier of this club, about 450 funds. Most estimates calculate that this group controls the majority of the smart money’s total capital, and by keeping an eye on their top stock picks, we have uncovered a few investment strategies that have historically outpaced the S&P 500 index. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points a 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 outclassed the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Just as important, positive insider trading sentiment is another way to parse down the stock market universe. Obviously, there are many stimuli for a corporate insider to downsize shares of his or her company, but only one, very obvious reason why they would buy. Many empirical studies have demonstrated the valuable potential of this strategy if investors know where to look (learn more here).
Consequently, we’re going to take a look at the key action regarding Constant Contact Inc (NASDAQ:CTCT).
Hedge fund activity in Constant Contact Inc (NASDAQ:CTCT)
Heading into Q2, a total of 8 of the hedge funds we track held long positions in this stock, a change of -11% from the previous quarter. With the smart money’s capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully.
When looking at the hedgies we track, Soros Fund Management, managed by George Soros, holds the most valuable position in Constant Contact Inc (NASDAQ:CTCT). Soros Fund Management has a $9.7 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Renaissance Technologies, managed by Jim Simons, which held a $4.1 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Remaining peers with similar optimism include Israel Englander’s Millennium Management, Glenn Russell Dubin’s Highbridge Capital Management and Ken Griffin’s Citadel Investment Group.
Due to the fact that Constant Contact Inc (NASDAQ:CTCT) has faced declining sentiment from the aggregate hedge fund industry, we can see that there was a specific group of fund managers that slashed their entire stakes at the end of the first quarter. At the top of the heap, Eric Semler’s TCS Capital Management cut the largest stake of all the hedgies we monitor, worth about $3.6 million in stock., and Robert B. Gillam of McKinley Capital Management was right behind this move, as the fund sold off about $1.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest dropped by 1 funds at the end of the first quarter.
What have insiders been doing with Constant Contact Inc (NASDAQ:CTCT)?
Bullish insider trading is best served when the company we’re looking at has seen transactions within the past half-year. Over the last 180-day time frame, Constant Contact Inc (NASDAQ:CTCT) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Constant Contact Inc (NASDAQ:CTCT). These stocks are Marchex, Inc. (NASDAQ:MCHX), National CineMedia, Inc. (NASDAQ:NCMI), MDC Partners Inc. (USA) (NASDAQ:MDCA), Millennial Media, Inc. (NYSE:MM), and Harte-Hanks, Inc. (NYSE:HHS). This group of stocks are the members of the marketing services industry and their market caps resemble CTCT’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Marchex, Inc. (NASDAQ:MCHX) | 5 | 0 | 1 |
| National CineMedia, Inc. (NASDAQ:NCMI) | 14 | 0 | 2 |
| MDC Partners Inc. (USA) (NASDAQ:MDCA) | 6 | 0 | 0 |
| Millennial Media, Inc. (NYSE:MM) | 12 | 0 | 5 |
| Harte-Hanks, Inc. (NYSE:HHS) | 14 | 0 | 1 |
With the results demonstrated by Insider Monkey’s research, everyday investors should always watch hedge fund and insider trading sentiment, and Constant Contact Inc (NASDAQ:CTCT) is no exception.
