Pretium Resources Inc (PVG): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Pretium Resources Inc (NYSE:PVG) investors should be aware of an increase in enthusiasm from smart money lately.

In today’s marketplace, there are tons of gauges market participants can use to monitor their holdings. A pair of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best hedge fund managers can outclass their index-focused peers by a significant amount (see just how much).

Equally as important, bullish insider trading activity is another way to parse down the stock market universe. There are lots of reasons for a corporate insider to drop shares of his or her company, but only one, very obvious reason why they would behave bullishly. Many academic studies have demonstrated the valuable potential of this tactic if piggybackers understand what to do (learn more here).

Keeping this in mind, let’s take a gander at the latest action surrounding Pretium Resources Inc (NYSE:PVG).

How are hedge funds trading Pretium Resources Inc (NYSE:PVG)?

In preparation for this quarter, a total of 9 of the hedge funds we track were long in this stock, a change of 80% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of noteworthy hedge fund managers who were boosting their holdings significantly.

Of the funds we track, Royce & Associates, managed by Chuck Royce, holds the largest position in Pretium Resources Inc (NYSE:PVG). Royce & Associates has a $79 million position in the stock, comprising 0.2% of its 13F portfolio. The second largest stake is held by Passport Capital, managed by John Burbank, which held a $47 million position; 1.9% of its 13F portfolio is allocated to the company. Other hedge funds that are bullish include Peter Franklin Palmedo’s Sun Valley Gold, Eric Sprott’s Sprott Asset Management and Andrew Weiss’s Weiss Asset Management.

Consequently, key hedge funds have been driving this bullishness. D E Shaw, managed by D. E. Shaw, assembled the biggest position in Pretium Resources Inc (NYSE:PVG). D E Shaw had 0.8 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also initiated a $0.5 million position during the quarter. The only other fund with a new position in the stock is Steven Cohen’s SAC Capital Advisors.

What have insiders been doing with Pretium Resources Inc (NYSE:PVG)?

Insider buying is particularly usable when the company in question has seen transactions within the past half-year. Over the latest half-year time frame, Pretium Resources Inc (NYSE:PVG) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to Pretium Resources Inc (NYSE:PVG). These stocks are Molycorp Inc (NYSE:MCP), SilverCrest Mines Inc (NYSEAMEX:SVLC), North American Palladium Ltd (USA) (NYSEAMEX:PAL), Paramount Gold and Silver Corp. (NYSEAMEX:PZG), and Northern Dynasty Minerals Ltd. (USA) (NYSEAMEX:NAK). This group of stocks are in the industrial metals & minerals industry and their market caps are closest to PVG’s market cap.

With the results shown by our strategies, everyday investors must always monitor hedge fund and insider trading sentiment, and Pretium Resources Inc (NYSE:PVG) applies perfectly to this mantra.

Click here to learn why you should track hedge funds