Sociedad Quimica y Minera (ADR) (NYSE:SQM) was in 12 hedge funds’ portfolio at the end of December. SQM has seen a decrease in activity from the world’s largest hedge funds recently. There were 13 hedge funds in our database with SQM positions at the end of the previous quarter.
If you’d ask most traders, hedge funds are viewed as worthless, outdated investment tools of yesteryear. While there are more than 8000 funds with their doors open at the moment, we look at the moguls of this club, about 450 funds. It is estimated that this group controls the majority of the smart money’s total capital, and by monitoring their top investments, we have deciphered a number of investment strategies that have historically beaten the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outpaced the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).
Just as integral, positive insider trading sentiment is another way to parse down the financial markets. There are a number of motivations for an upper level exec to downsize shares of his or her company, but only one, very obvious reason why they would behave bullishly. Various academic studies have demonstrated the market-beating potential of this tactic if shareholders understand what to do (learn more here).
With these “truths” under our belt, we’re going to take a gander at the key action surrounding Sociedad Quimica y Minera (ADR) (NYSE:SQM).
Hedge fund activity in Sociedad Quimica y Minera (ADR) (NYSE:SQM)
At the end of the fourth quarter, a total of 12 of the hedge funds we track held long positions in this stock, a change of -8% from one quarter earlier. With hedgies’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their holdings significantly.
Of the funds we track, Renaissance Technologies, managed by Jim Simons, holds the largest position in Sociedad Quimica y Minera (ADR) (NYSE:SQM). Renaissance Technologies has a $18 million position in the stock, comprising 0.1% of its 13F portfolio. On Renaissance Technologies’s heels is Cliff Asness of AQR Capital Management, with a $13 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include Clint Carlson’s Carlson Capital, D. E. Shaw’s D E Shaw and Israel Englander’s Millennium Management.
Seeing as Sociedad Quimica y Minera (ADR) (NYSE:SQM) has experienced falling interest from the entirety of the hedge funds we track, logic holds that there were a few money managers that elected to cut their entire stakes heading into 2013. At the top of the heap, Bruce Kovner’s Caxton Associates LP sold off the largest investment of the 450+ funds we monitor, totaling about $1 million in stock.. Noam Gottesman’s fund, GLG Partners, also dumped its stock, about $1 million worth. These moves are important to note, as total hedge fund interest was cut by 1 funds heading into 2013.
How have insiders been trading Sociedad Quimica y Minera (ADR) (NYSE:SQM)?
Bullish insider trading is at its handiest when the primary stock in question has experienced transactions within the past 180 days. Over the latest 180-day time frame, Sociedad Quimica y Minera (ADR) (NYSE:SQM) has experienced zero unique insiders purchasing, and zero 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 Sociedad Quimica y Minera (ADR) (NYSE:SQM). These stocks are Ashland Inc. (NYSE:ASH), Celanese Corporation (NYSE:CE), FMC Corp (NYSE:FMC), Eastman Chemical Company (NYSE:EMN), and Air Products & Chemicals, Inc. (NYSE:APD). All of these stocks are in the chemicals – major diversified industry and their market caps are closest to SQM’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Ashland Inc. (NYSE:ASH) | 28 | 0 | 6 |
| Celanese Corporation (NYSE:CE) | 24 | 0 | 2 |
| FMC Corp (NYSE:FMC) | 18 | 0 | 1 |
| Eastman Chemical Company (NYSE:EMN) | 45 | 0 | 9 |
| Air Products & Chemicals, Inc. (NYSE:APD) | 16 | 1 | 3 |
With the results exhibited by Insider Monkey’s time-tested strategies, retail investors should always pay attention to hedge fund and insider trading sentiment, and Sociedad Quimica y Minera (ADR) (NYSE:SQM) is no exception.
