Inland Real Estate Corporation (IRC): Insiders Are Buying, Should You?

Is Inland Real Estate Corporation (NYSE:IRC) the right pick for your portfolio? The smart money is reducing their bets on the stock. The number of bullish hedge fund bets retreated by 1 recently.

In the eyes of most traders, hedge funds are seen as slow, old financial vehicles of yesteryear. While there are more than 8000 funds with their doors open today, we choose to focus on the moguls of this group, around 450 funds. It is widely believed that this group controls most of the hedge fund industry’s total capital, and by tracking their highest performing stock picks, we have identified a few investment strategies that have historically beaten the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per annum 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 trumped the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).

Equally as important, optimistic insider trading sentiment is another way to break down the financial markets. Obviously, there are plenty of incentives for an insider to sell shares of his or her company, but only one, very clear reason why they would behave bullishly. Plenty of empirical studies have demonstrated the impressive potential of this strategy if piggybackers understand where to look (learn more here).

Now, let’s take a look at the recent action encompassing Inland Real Estate Corporation (NYSE:IRC).

What does the smart money think about Inland Real Estate Corporation (NYSE:IRC)?

At the end of the first quarter, a total of 5 of the hedge funds we track were bullish in this stock, a change of -17% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were boosting their stakes substantially.

Of the funds we track, AQR Capital Management, managed by Cliff Asness, holds the biggest position in Inland Real Estate Corporation (NYSE:IRC). AQR Capital Management has a $14.4 million position in the stock, comprising 0.1% of its 13F portfolio. The second largest stake is held by Citadel Investment Group, managed by Ken Griffin, which held a $0.5 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Remaining hedgies with similar optimism include Israel Englander’s Millennium Management, John Burbank’s Passport Capital and Matthew Hulsizer’s PEAK6 Capital Management.

Because Inland Real Estate Corporation (NYSE:IRC) has faced declining sentiment from the entirety of the hedge funds we track, we can see that there exists a select few hedge funds who sold off their full holdings at the end of the first quarter. At the top of the heap, D. E. Shaw’s D E Shaw cut the biggest position of the “upper crust” of funds we monitor, comprising about $1 million in stock.. John Overdeck and David Siegel’s fund, Two Sigma Advisors, also dropped its stock, about $0.3 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest was cut by 1 funds at the end of the first quarter.

Insider trading activity in Inland Real Estate Corporation (NYSE:IRC)

Insider trading activity, especially when it’s bullish, is particularly usable when the company in question has seen transactions within the past six months. Over the latest six-month time period, Inland Real Estate Corporation (NYSE:IRC) has seen 2 unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s also examine hedge fund and insider activity in other stocks similar to Inland Real Estate Corporation (NYSE:IRC). These stocks are Hersha Hospitality Trust (NYSE:HT), Pennsylvania R.E.I.T. (NYSE:PEI), Retail Opportunity Investments Corp (NASDAQ:ROIC), Ramco-Gershenson Properties Trust (NYSE:RPT), and Saul Centers Inc (NYSE:BFS). This group of stocks are in the reit – retail industry and their market caps are closest to IRC’s market cap.

With the results shown by our tactics, everyday investors must always watch hedge fund and insider trading activity, and Inland Real Estate Corporation (NYSE:IRC) is no exception.

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