Should Pain Therapeutics, Inc. (NASDAQ:PTIE) investors track the following data?
In the eyes of many investors, hedge funds are viewed as overrated, old investment vehicles of an era lost to time. Although there are more than 8,000 hedge funds in operation today, Insider Monkey looks at the upper echelon of this club, close to 525 funds. Analysts calculate that this group controls the majority of the smart money’s total assets, and by tracking their highest quality picks, we’ve formulated a few investment strategies that have historically outpaced the broader indices. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per year 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 33 percentage points in 11 months (see all of our picks from August).
Just as crucial, positive insider trading sentiment is a second way to analyze the investments you’re interested in. As the old adage goes: there are many incentives for a bullish insider to drop shares of his or her company, but just one, very clear reason why they would behave bullishly. Various academic studies have demonstrated the valuable potential of this method if investors know where to look (learn more here).
Keeping this in mind, let’s analyze the recent info surrounding Pain Therapeutics, Inc. (NASDAQ:PTIE).
What have hedge funds been doing with Pain Therapeutics, Inc. (NASDAQ:PTIE)?
At Q2’s end, a total of 12 of the hedge funds we track held long positions in this stock, a change of 20% from one quarter earlier. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings substantially.
As one would understandably expect, particular hedge funds have jumped into Pain Therapeutics, Inc. (NASDAQ:PTIE) headfirst. Visium Asset Management, managed by Jacob Gottlieb, initiated the most outsized position in Pain Therapeutics, Inc. (NASDAQ:PTIE). Visium Asset Management had 9.6 million invested in the company at the end of the quarter. Matt McLennan’s First Eagle Investment Management also initiated a $4.1 million position during the quarter. The other funds with brand new PTIE positions are Jacob Gottlieb’s Visium Asset Management, Kevin Kotler’s Broadfin Capital, and Jim Simons’s Renaissance Technologies.
What do corporate executives and insiders think about Pain Therapeutics, Inc. (NASDAQ:PTIE)?
Insider buying made by high-level executives is best served when the primary stock in question has seen transactions within the past half-year. Over the last 180-day time frame, Pain Therapeutics, Inc. (NASDAQ:PTIE) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll also review the relationship between both of these indicators in other stocks similar to Pain Therapeutics, Inc. (NASDAQ:PTIE). These stocks are Cytokinetics, Inc. (NASDAQ:CYTK), ArQule, Inc. (NASDAQ:ARQL), ZIOPHARM Oncology Inc. (NASDAQ:ZIOP), BioDelivery Sciences International, Inc. (NASDAQ:BDSI), and Amicus Therapeutics, Inc. (NASDAQ:FOLD). This group of stocks are the members of the biotechnology industry and their market caps are similar to PTIE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Cytokinetics, Inc. (NASDAQ:CYTK) | 8 | 0 | 0 |
| ArQule, Inc. (NASDAQ:ARQL) | 10 | 0 | 0 |
| ZIOPHARM Oncology Inc. (NASDAQ:ZIOP) | 7 | 0 | 0 |
| BioDelivery Sciences International, Inc. (NASDAQ:BDSI) | 8 | 0 | 0 |
| Amicus Therapeutics, Inc. (NASDAQ:FOLD) | 13 | 0 | 0 |
Using the results demonstrated by the previously mentioned tactics, average investors should always keep one eye on hedge fund and insider trading activity, and Pain Therapeutics, Inc. (NASDAQ:PTIE) applies perfectly to this mantra.
