Is SouFun Holdings Limited (ADR) (SFUN) Going to Burn These Hedge Funds?

SouFun Holdings Limited (ADR) (NYSE:SFUN) has experienced an increase in support from the world’s most elite money managers in recent months.

In the financial world, there are a multitude of indicators shareholders can use to watch stocks. Two of the most useful are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite money managers can beat their index-focused peers by a very impressive amount (see just how much).

Equally as beneficial, positive insider trading sentiment is another way to break down the world of equities. Obviously, there are plenty of motivations for an executive to downsize shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several academic studies have demonstrated the useful potential of this strategy if “monkeys” know what to do (learn more here).

With all of this in mind, it’s important to take a peek at the key action surrounding SouFun Holdings Limited (ADR) (NYSE:SFUN).

How have hedgies been trading SouFun Holdings Limited (ADR) (NYSE:SFUN)?

In preparation for this quarter, a total of 8 of the hedge funds we track were bullish in this stock, a change of 14% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were increasing their stakes meaningfully.

Of the funds we track, Scott Sinclair and Laurence Chang’s Cascabel Management had the most valuable position in SouFun Holdings Limited (ADR) (NYSE:SFUN), worth close to $26.5 million, comprising 9.1% of its total 13F portfolio. The second largest stake is held by Julian Robertson of Tiger Management, with a $11.2 million position; the fund has 1.5% of its 13F portfolio invested in the stock. Other hedge funds that hold long positions include Robert Karr’s Joho Capital, John Wu’s Sureview Capital and Israel Englander’s Millennium Management.

Consequently, key money managers were leading the bulls’ herd. Sureview Capital, managed by John Wu, assembled the biggest position in SouFun Holdings Limited (ADR) (NYSE:SFUN). Sureview Capital had 3.9 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also initiated a $1.3 million position during the quarter. The other funds with new positions in the stock are Robert B. Gillam’s McKinley Capital Management, Steven Cohen’s SAC Capital Advisors, and SAC Subsidiary’s CR Intrinsic Investors.

What have insiders been doing with SouFun Holdings Limited (ADR) (NYSE:SFUN)?

Bullish insider trading is particularly usable when the primary stock in question has experienced transactions within the past 180 days. Over the last six-month time frame, SouFun Holdings Limited (ADR) (NYSE:SFUN) has seen 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 SouFun Holdings Limited (ADR) (NYSE:SFUN). These stocks are Blucora Inc (NASDAQ:BCOR), Renren Inc (NYSE:RENN), HealthStream, Inc. (NASDAQ:HSTM), Bitauto Hldg Ltd (ADR) (NYSE:BITA), and Move Inc. (NASDAQ:MOVE). This group of stocks are the members of the internet information providers industry and their market caps are similar to SFUN’s market cap.

With the results demonstrated by our time-tested strategies, everyday investors should always watch hedge fund and insider trading activity, and SouFun Holdings Limited (ADR) (NYSE:SFUN) shareholders fit into this picture quite nicely.

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