Is Msci Inc (NYSE:MSCI) worth your attention right now? Money managers are getting more bullish. The number of long hedge fund positions rose by 5 in recent months.
According to most shareholders, hedge funds are perceived as slow, outdated investment vehicles of the past. While there are more than 8000 funds trading at the moment, we at Insider Monkey choose to focus on the bigwigs of this club, close to 450 funds. Most estimates calculate that this group oversees the lion’s share of all hedge funds’ total asset base, and by keeping an eye on their best picks, we have formulated a number of investment strategies that have historically outperformed Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).
Just as integral, optimistic insider trading activity is a second way to parse down the marketplace. As the old adage goes: there are plenty of motivations for a bullish insider to cut shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the impressive potential of this tactic if piggybackers understand where to look (learn more here).
Consequently, let’s take a gander at the key action encompassing Msci Inc (NYSE:MSCI).
How have hedgies been trading Msci Inc (NYSE:MSCI)?
At the end of the fourth quarter, a total of 13 of the hedge funds we track held long positions in this stock, a change of 63% from the third quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their holdings meaningfully.
When looking at the hedgies we track, Generation Investment Management, managed by David Blood and Al Gore, holds the largest position in Msci Inc (NYSE:MSCI). Generation Investment Management has a $243 million position in the stock, comprising 5.7% of its 13F portfolio. The second largest stake is held by Jeffrey Ubben of ValueAct Capital, with a $191 million position; the fund has 2.4% of its 13F portfolio invested in the stock. Other peers that hold long positions include John C. Walker’s Stonerise Capital Management, Ken Griffin’s Citadel Investment Group and Mark Kingdon’s Kingdon Capital.
As aggregate interest increased, specific money managers were breaking ground themselves. ValueAct Capital, managed by Jeffrey Ubben, initiated the biggest position in Msci Inc (NYSE:MSCI). ValueAct Capital had 191 million invested in the company at the end of the quarter. John C. Walker’s Stonerise Capital Management also made a $21 million investment in the stock during the quarter. The following funds were also among the new MSCI investors: Ken Griffin’s Citadel Investment Group, Mark Kingdon’s Kingdon Capital, and Richard Chilton’s Chilton Investment Company.
How are insiders trading Msci Inc (NYSE:MSCI)?
Insider buying is best served when the company in focus has seen transactions within the past six months. Over the last six-month time period, Msci Inc (NYSE:MSCI) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Msci Inc (NYSE:MSCI). These stocks are SolarWinds Inc (NYSE:SWI), CommVault Systems, Inc. (NASDAQ:CVLT), Fortinet Inc (NASDAQ:FTNT), Cadence Design Systems Inc (NASDAQ:CDNS), and Splunk Inc (NASDAQ:SPLK). This group of stocks are the members of the application software industry and their market caps are similar to MSCI’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| SolarWinds Inc (NYSE:SWI) | 19 | 0 | 9 |
| CommVault Systems, Inc. (NASDAQ:CVLT) | 14 | 0 | 8 |
| Fortinet Inc (NASDAQ:FTNT) | 26 | 0 | 3 |
| Cadence Design Systems Inc (NASDAQ:CDNS) | 19 | 0 | 4 |
| Splunk Inc (NASDAQ:SPLK) | 22 | 0 | 8 |
With the returns demonstrated by the aforementioned strategies, everyday investors should always monitor hedge fund and insider trading activity, and Msci Inc (NYSE:MSCI) applies perfectly to this mantra.
