Is CSG Systems International, Inc. (CSGS) Going to Burn These Hedge Funds?

CSG Systems International, Inc. (NASDAQ:CSGS) has seen a decrease in hedge fund interest recently.

In the 21st century investor’s toolkit, there are dozens of indicators investors can use to monitor publicly traded companies. Some of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best investment managers can trounce the market by a very impressive margin (see just how much).

Equally as important, bullish insider trading activity is a second way to break down the investments you’re interested in. Obviously, there are many incentives for an insider to get rid of shares of his or her company, but just one, very simple reason why they would initiate a purchase. Many academic studies have demonstrated the impressive potential of this strategy if piggybackers know what to do (learn more here).

With these “truths” under our belt, it’s important to take a look at the key action encompassing CSG Systems International, Inc. (NASDAQ:CSGS).

How are hedge funds trading CSG Systems International, Inc. (NASDAQ:CSGS)?

At the end of the first quarter, a total of 16 of the hedge funds we track were bullish in this stock, a change of 0% from the previous quarter. With hedgies’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were increasing their stakes substantially.

When looking at the hedgies we track, Renaissance Technologies, managed by Jim Simons, holds the most valuable position in CSG Systems International, Inc. (NASDAQ:CSGS). Renaissance Technologies has a $34.3 million position in the stock, comprising 0.1% of its 13F portfolio. On Renaissance Technologies’s heels is Ric Dillon of Diamond Hill Capital, with a $17.9 million position; 0.2% of its 13F portfolio is allocated to the company. Remaining hedgies that hold long positions include Cliff Asness’s AQR Capital Management, Anthony Bozza’s Lakewood Capital Management and David Dreman’s Dreman Value Management.

Because CSG Systems International, Inc. (NASDAQ:CSGS) has faced declining sentiment from hedge fund managers, we can see that there is a sect of fund managers who sold off their positions entirely at the end of the first quarter. It’s worth mentioning that David Costen Haley’s HBK Investments dropped the largest investment of all the hedgies we key on, comprising close to $0.4 million in stock.. Matthew Tewksbury’s fund, Stevens Capital Management, also sold off its stock, about $0.3 million worth. These moves are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Insider trading activity in CSG Systems International, Inc. (NASDAQ:CSGS)

Bullish insider trading is most useful when the company we’re looking at has experienced transactions within the past half-year. Over the last 180-day time period, CSG Systems International, Inc. (NASDAQ:CSGS) has seen zero unique insiders buying, and 5 insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to CSG Systems International, Inc. (NASDAQ:CSGS). These stocks are NetScout Systems, Inc. (NASDAQ:NTCT), Servicesource International Inc (NASDAQ:SREV), Ebix Inc (NASDAQ:EBIX), and Interactive Intelligence Group Inc (NASDAQ:ININ). All of these stocks are in the business software & services industry and their market caps resemble CSGS’s market cap.

With the returns shown by our time-tested strategies, retail investors should always pay attention to hedge fund and insider trading sentiment, and CSG Systems International, Inc. (NASDAQ:CSGS) applies perfectly to this mantra.

Click here to learn why you should track hedge funds