Here is What Hedge Funds Think About Partnerre Ltd (PRE)

Partnerre Ltd (NYSE:PRE) investors should pay attention to a decrease in activity from the world’s largest hedge funds recently.

According to most investors, hedge funds are seen as worthless, old investment tools of years past. While there are over 8000 funds trading at present, we at Insider Monkey look at the leaders of this club, close to 450 funds. It is estimated that this group has its hands on the majority of the hedge fund industry’s total asset base, and by paying attention to their highest performing stock picks, we have spotted a number of investment strategies that have historically outpaced the S&P 500 index. Our small-cap hedge fund strategy outperformed 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 beaten the S&P 500 index by 23.3 percentage points in 8 months (see the details here).

Equally as key, optimistic insider trading activity is a second way to break down the marketplace. Obviously, there are lots of incentives for a corporate insider to downsize shares of his or her company, but only one, very simple reason why they would initiate a purchase. Plenty of academic studies have demonstrated the impressive potential of this strategy if investors know what to do (learn more here).

Now, let’s take a peek at the key action encompassing Partnerre Ltd (NYSE:PRE).

What have hedge funds been doing with Partnerre Ltd (NYSE:PRE)?

At Q1’s end, a total of 17 of the hedge funds we track were long in this stock, a change of -11% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were boosting their holdings considerably.

Of the funds we track, Pzena Investment Management, managed by Richard S. Pzena, holds the biggest position in Partnerre Ltd (NYSE:PRE). Pzena Investment Management has a $127.3 million position in the stock, comprising 0.9% of its 13F portfolio. Sitting at the No. 2 spot is Clint Carlson of Carlson Capital, with a $38.8 million position; 0.5% of its 13F portfolio is allocated to the company. Remaining hedgies that are bullish include Michael Messner’s Seminole Capital (Investment Mgmt), Chuck Royce’s Royce & Associates and Brian Ashford-Russell and Tim Woolley’s Polar Capital.

Because Partnerre Ltd (NYSE:PRE) has experienced declining sentiment from the aggregate hedge fund industry, we can see that there is a sect of hedge funds that slashed their entire stakes last quarter. Intriguingly, Ken Griffin’s Citadel Investment Group dumped the largest position of the “upper crust” of funds we track, worth an estimated $12.1 million in stock., and Peter Rathjens, Bruce Clarke and John Campbell of Arrowstreet Capital was right behind this move, as the fund dropped about $6 million worth. These transactions are intriguing to say the least, as total hedge fund interest was cut by 2 funds last quarter.

How have insiders been trading Partnerre Ltd (NYSE:PRE)?

Insider trading activity, especially when it’s bullish, is at its handiest when the company in question has seen transactions within the past six months. Over the latest 180-day time period, Partnerre Ltd (NYSE:PRE) 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 Partnerre Ltd (NYSE:PRE). These stocks are HCC Insurance Holdings, Inc. (NYSE:HCC), Alleghany Corporation (NYSE:Y), Markel Corporation (NYSE:MKL), W.R. Berkley Corporation (NYSE:WRB), and Axis Capital Holdings Limited (NYSE:AXS). This group of stocks are the members of the property & casualty insurance industry and their market caps are closest to PRE’s market cap.

With the results demonstrated by the aforementioned tactics, everyday investors must always keep an eye on hedge fund and insider trading activity, and Partnerre Ltd (NYSE:PRE) is no exception.

Click here to learn why you should track hedge funds