Should ABB Ltd (ADR) (NYSE:ABB) investors track the following data?
At the moment, there are plenty of indicators market participants can use to monitor stocks. Some of the most under-the-radar are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top fund managers can outperform the broader indices by a significant margin (see just how much).
Just as useful, bullish insider trading activity is a second way to look at the marketplace. There are a variety of reasons for an insider to sell shares of his or her company, but only one, very simple reason why they would behave bullishly. Several empirical studies have demonstrated the useful potential of this strategy if piggybackers understand where to look (learn more here).
Now that that’s out of the way, let’s examine the newest info surrounding ABB Ltd (ADR) (NYSE:ABB).
How have hedgies been trading ABB Ltd (ADR) (NYSE:ABB)?
Heading into Q3, a total of 9 of the hedge funds we track were long in this stock, a change of -18% from the previous quarter. With hedge funds’ capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully.
Out of the hedge funds we follow, Jim Simons’s Renaissance Technologies had the largest position in ABB Ltd (ADR) (NYSE:ABB), worth close to $23.9 million, accounting for 0.1% of its total 13F portfolio. Coming in second is John A. Levin of Levin Capital Strategies, with a $15.6 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include David Dreman’s Dreman Value Management, and Mario Gabelli’s GAMCO Investors.
Since ABB Ltd (ADR) (NYSE:ABB) has experienced dropping sentiment from upper-tier hedge fund managers, it’s safe to say that there was a specific group of funds who sold off their full holdings at the end of the second quarter. It’s worth mentioning that Ken Griffin’s Citadel Investment Group dropped the biggest stake of the “upper crust” of funds we key on, valued at an estimated $2.6 million in stock, and Robert Raiff of Raiff Partners was right behind this move, as the fund sold off about $2.5 million worth. These moves are important to note, as total hedge fund interest fell by 2 funds at the end of the second quarter.
How have insiders been trading ABB Ltd (ADR) (NYSE:ABB)?
Legal insider trading, particularly when it’s bullish, is at its handiest when the company in question has seen transactions within the past six months. Over the last 180-day time frame, ABB Ltd (ADR) (NYSE:ABB) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We’ll also examine the relationship between both of these indicators in other stocks similar to ABB Ltd (ADR) (NYSE:ABB). These stocks are REGAL-BELOIT CORPORATION (NYSE:RBC), Nidec Corporation (ADR) (NYSE:NJ), AMETEK, Inc. (NYSE:AME), Rockwell Automation (NYSE:ROK), and Eaton Corporation, PLC Ordinary Shares (NYSE:ETN). This group of stocks belong to the industrial electrical equipment industry and their market caps are closest to ABB’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| REGAL-BELOIT CORPORATION (NYSE:RBC) | 16 | 0 | 0 |
| Nidec Corporation (ADR) (NYSE:NJ) | 5 | 0 | 0 |
| AMETEK, Inc. (NYSE:AME) | 18 | 0 | 0 |
| Rockwell Automation (NYSE:ROK) | 27 | 0 | 0 |
| Eaton Corporation, PLC Ordinary Shares (NYSE:ETN) | 45 | 0 | 0 |
Using the results shown by the previously mentioned tactics, regular investors must always watch hedge fund and insider trading activity, and ABB Ltd (ADR) (NYSE:ABB) is no exception.
