SCANA Corporation (NYSE:SCG) shareholders have witnessed an increase in support from the world’s most elite money managers of late.
If you’d ask most shareholders, hedge funds are viewed as slow, outdated financial vehicles of the past. While there are greater than 8000 funds trading today, we look at the elite of this group, close to 450 funds. It is estimated that this group controls most of all hedge funds’ total asset base, and by tracking their top stock picks, we have formulated a number of investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outperformed 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 outperformed the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).
Just as beneficial, positive insider trading sentiment is another way to break down the world of equities. Just as you’d expect, there are plenty of motivations for an upper level exec to downsize shares of his or her company, but just one, very obvious reason why they would behave bullishly. Plenty of empirical studies have demonstrated the impressive potential of this tactic if you understand where to look (learn more here).
With all of this in mind, let’s take a glance at the recent action regarding SCANA Corporation (NYSE:SCG).
What have hedge funds been doing with SCANA Corporation (NYSE:SCG)?
Heading into 2013, a total of 10 of the hedge funds we track were long in this stock, a change of 25% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their holdings meaningfully.
Of the funds we track, Winton Capital Management, managed by David Harding, holds the biggest position in SCANA Corporation (NYSE:SCG). Winton Capital Management has a $26 million position in the stock, comprising 0.7% of its 13F portfolio. Coming in second is Citadel Investment Group, managed by Ken Griffin, which held a $9 million position; the fund has 0% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include Israel Englander’s Millennium Management, Phill Gross and Robert Atchinson’s Adage Capital Management and Douglas W. Case’s Advanced Investment Partners.
As industrywide interest jumped, specific money managers have jumped into SCANA Corporation (NYSE:SCG) headfirst. D E Shaw, managed by D. E. Shaw, initiated the most outsized position in SCANA Corporation (NYSE:SCG). D E Shaw had 3 million invested in the company at the end of the quarter. Paul Tudor Jones’s Tudor Investment Corp also made a $1 million investment in the stock during the quarter. The only other fund with a new position in the stock is Cliff Asness’s AQR Capital Management.
What do corporate executives and insiders think about SCANA Corporation (NYSE:SCG)?
Insider buying is at its handiest when the company we’re looking at has seen transactions within the past half-year. Over the latest six-month time period, SCANA Corporation (NYSE:SCG) has seen zero unique insiders buying, and 1 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to SCANA Corporation (NYSE:SCG). These stocks are Brookfield Infrastructure Partners L.P. (NYSE:BIP), Alliant Energy Corporation (NYSE:LNT), CMS Energy Corporation (NYSE:CMS), Pinnacle West Capital Corporation (NYSE:PNW), and OGE Energy Corp. (NYSE:OGE). This group of stocks are the members of the electric utilities industry and their market caps match SCG’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Brookfield Infrastructure Partners L.P. (NYSE:BIP) | 6 | 0 | 0 |
| Alliant Energy Corporation (NYSE:LNT) | 14 | 1 | 0 |
| CMS Energy Corporation (NYSE:CMS) | 12 | 0 | 5 |
| Pinnacle West Capital Corporation (NYSE:PNW) | 11 | 0 | 3 |
| OGE Energy Corp. (NYSE:OGE) | 11 | 0 | 1 |
With the returns exhibited by our strategies, retail investors should always watch hedge fund and insider trading sentiment, and SCANA Corporation (NYSE:SCG) is no exception.
