Should You Avoid FX Energy, Inc. (FXEN)?

FX Energy, Inc. (NASDAQ:FXEN) investors should pay attention to a decrease in hedge fund sentiment of late.

In the financial world, there are tons of methods market participants can use to track publicly traded companies. A couple of the best 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 elite investment managers can outpace the market by a solid margin (see just how much).

Just as important, positive insider trading activity is another way to break down the marketplace. Obviously, there are a variety of incentives for an insider to sell shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many empirical studies have demonstrated the impressive potential of this strategy if investors know where to look (learn more here).

With all of this in mind, it’s important to take a glance at the latest action encompassing FX Energy, Inc. (NASDAQ:FXEN).

Hedge fund activity in FX Energy, Inc. (NASDAQ:FXEN)

In preparation for this quarter, a total of 8 of the hedge funds we track were bullish in this stock, a change of 0% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their holdings meaningfully.

According to our comprehensive database, Odey Asset Management Group, managed by Crispin Odey, holds the most valuable position in FX Energy, Inc. (NASDAQ:FXEN). Odey Asset Management Group has a $3.8 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Citadel Investment Group, managed by Ken Griffin, which held a $1.2 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Israel Englander’s Millennium Management, Glenn Russell Dubin’s Highbridge Capital Management and Matthew Hulsizer’s PEAK6 Capital Management.

Due to the fact that FX Energy, Inc. (NASDAQ:FXEN) has experienced a declination in interest from the aggregate hedge fund industry, it’s easy to see that there were a few fund managers that elected to cut their full holdings last quarter. Interestingly, Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk’s GRT Capital Partners cut the biggest position of the 450+ funds we monitor, totaling about $0.2 million in stock., and Mike Vranos of Ellington was right behind this move, as the fund cut about $0.1 million worth. These moves are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

What have insiders been doing with FX Energy, Inc. (NASDAQ:FXEN)?

Bullish insider trading is particularly usable when the primary stock in question has experienced transactions within the past six months. Over the last six-month time period, FX Energy, Inc. (NASDAQ:FXEN) has seen zero unique insiders buying, and 3 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to FX Energy, Inc. (NASDAQ:FXEN). These stocks are BPZ Resources Inc (NYSE:BPZ), Eca Marcellus Trust I (NYSE:ECT), ZaZa Energy Corp (NASDAQ:ZAZA), Cross Timbers Royalty Trust (NYSE:CRT), and Emerald Oil Inc (NYSEAMEX:EOX). This group of stocks belong to the oil & gas drilling & exploration industry and their market caps match FXEN’s market cap.

With the returns demonstrated by Insider Monkey’s research, everyday investors must always pay attention to hedge fund and insider trading sentiment, and FX Energy, Inc. (NASDAQ:FXEN) shareholders fit into this picture quite nicely.

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