Is Innophos Holdings, Inc. (IPHS) Going to Burn These Hedge Funds?

Innophos Holdings, Inc. (NASDAQ:IPHS) was in 9 hedge funds’ portfolio at the end of the first quarter of 2013. IPHS investors should be aware of a decrease in hedge fund interest in recent months. There were 13 hedge funds in our database with IPHS positions at the end of the previous quarter.

In the 21st century investor’s toolkit, there are tons of methods market participants can use to track stocks. A pair of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best fund managers can outperform the broader indices by a solid margin (see just how much).

Equally as beneficial, positive insider trading sentiment is a second way to break down the financial markets. As the old adage goes: there are a variety of motivations for a bullish insider to sell shares of his or her company, but just one, very clear reason why they would behave bullishly. Many empirical studies have demonstrated the valuable potential of this method if shareholders understand what to do (learn more here).

Consequently, we’re going to take a glance at the key action surrounding Innophos Holdings, Inc. (NASDAQ:IPHS).

How have hedgies been trading Innophos Holdings, Inc. (NASDAQ:IPHS)?

At Q1’s end, a total of 9 of the hedge funds we track were long in this stock, a change of -31% from one quarter earlier. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were upping their stakes considerably.

According to our comprehensive database, Royce & Associates, managed by Chuck Royce, holds the biggest position in Innophos Holdings, Inc. (NASDAQ:IPHS). Royce & Associates has a $50.2 million position in the stock, comprising 0.2% of its 13F portfolio. The second largest stake is held by Jay Petschek and Steven Major of Corsair Capital Management, with a $29.4 million position; the fund has 4% of its 13F portfolio invested in the stock. Other peers that are bullish include Thomas A. Giovine’s Giovine Capital, Ken Griffin’s Citadel Investment Group and Jim Simons’s Renaissance Technologies.

Due to the fact that Innophos Holdings, Inc. (NASDAQ:IPHS) has experienced a declination in interest from the entirety of the hedge funds we track, logic holds that there was a specific group of funds who sold off their entire stakes at the end of the first quarter. At the top of the heap, Israel Englander’s Millennium Management dumped the biggest investment of the 450+ funds we track, totaling close to $3.5 million in stock., and Matthew Tewksbury of Stevens Capital Management was right behind this move, as the fund said goodbye to about $0.8 million worth. These transactions are interesting, as total hedge fund interest fell by 4 funds at the end of the first quarter.

What do corporate executives and insiders think about Innophos Holdings, Inc. (NASDAQ:IPHS)?

Insider purchases made by high-level executives is most useful when the company in question has experienced transactions within the past half-year. Over the last six-month time period, Innophos Holdings, Inc. (NASDAQ:IPHS) has experienced zero unique insiders purchasing, and 5 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Innophos Holdings, Inc. (NASDAQ:IPHS). These stocks are Flotek Industries Inc (NYSE:FTK), Kronos Worldwide, Inc. (NYSE:KRO), WD-40 Company (NASDAQ:WDFC), Koppers Holdings Inc. (NYSE:KOP), and Innospec Inc. (NASDAQ:IOSP). This group of stocks are the members of the specialty chemicals industry and their market caps are closest to IPHS’s market cap.

With the returns shown by the aforementioned time-tested strategies, everyday investors must always monitor hedge fund and insider trading activity, and Innophos Holdings, Inc. (NASDAQ:IPHS) applies perfectly to this mantra.

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