Should You Avoid Hilltop Holdings Inc. (HTH)?

What’s a smart Hilltop Holdings Inc. (NYSE:HTH) investor to do?

In the financial world, there are dozens of gauges investors can use to watch Mr. Market. A duo of the most useful are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite money managers can beat the broader indices by a healthy margin (see just how much).

Just as necessary, positive insider trading sentiment is another way to look at the investments you’re interested in. There are a variety of incentives for an executive to get rid of shares of his or her company, but just one, very simple reason why they would buy. Several empirical studies have demonstrated the valuable potential of this method if you know what to do (learn more here).

What’s more, it’s important to discuss the latest info for Hilltop Holdings Inc. (NYSE:HTH).

Hedge fund activity in Hilltop Holdings Inc. (NYSE:HTH)

In preparation for the third quarter, a total of 14 of the hedge funds we track were bullish in this stock, a change of -18% from the previous quarter. With hedge funds’ capital changing hands, there exists a few notable hedge fund managers who were increasing their stakes considerably.

Out of the hedge funds we follow, Chuck Royce’s Royce & Associates had the largest position in Hilltop Holdings Inc. (NYSE:HTH), worth close to $13.6 million, accounting for less than 0.1%% of its total 13F portfolio. On Royce & Associates’s heels is Bandera Partners, managed by Gregory Bylinsky and Jefferson Gramm, which held a $12.9 million position; 7.1% of its 13F portfolio is allocated to the company. Other peers with similar optimism include Jim Simons’s Renaissance Technologies, Jonathon Jacobson’s Highfields Capital Management and Glenn Russell Dubin’s Highbridge Capital Management.

As Hilltop Holdings Inc. (NYSE:HTH) has experienced declining interest from the top-tier hedge fund industry, we can see that there was a specific group of fund managers who sold off their entire stakes last quarter. It’s worth mentioning that John Overdeck and David Siegel’s Two Sigma Advisors cut the biggest position of all the hedgies we watch, comprising about $0.4 million in stock. Paul Tudor Jones’s fund, Tudor Investment Corp, also dumped its stock, about $0.4 million worth. These moves are important to note, as total hedge fund interest fell by 3 funds last quarter.

How are insiders trading Hilltop Holdings Inc. (NYSE:HTH)?

Bullish insider trading is most useful when the company in focus has experienced transactions within the past 180 days. Over the last six-month time period, Hilltop Holdings Inc. (NYSE:HTH) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also examine the relationship between both of these indicators in other stocks similar to Hilltop Holdings Inc. (NYSE:HTH). These stocks are Selective Insurance Group (NASDAQ:SIGI), FBL Financial Group (NYSE:FFG), MGIC Investment Corp. (NYSE:MTG), Argo Group International Holdings, Ltd. (NASDAQ:AGII), and Tower Group International Ltd (NASDAQ:TWGP). All of these stocks are in the property & casualty insurance industry and their market caps match HTH’s market cap.