Firstmerit Corp (NASDAQ:FMER) was in 12 hedge funds’ portfolio at the end of the fourth quarter of 2012. FMER shareholders have witnessed a decrease in enthusiasm from smart money in recent months. There were 13 hedge funds in our database with FMER holdings at the end of the previous quarter.
According to most investors, hedge funds are perceived as worthless, old investment vehicles of years past. While there are over 8000 funds with their doors open at present, we choose to focus on the upper echelon of this group, close to 450 funds. It is widely believed that this group oversees the majority of the smart money’s total capital, and by paying attention to their top picks, we have unearthed a number of 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 annum for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).
Just as important, bullish insider trading sentiment is a second way to parse down the marketplace. Just as you’d expect, there are many incentives for an executive to cut shares of his or her company, but only one, very clear reason why they would initiate a purchase. Various empirical studies have demonstrated the impressive potential of this method if you know where to look (learn more here).
Keeping this in mind, we’re going to take a glance at the latest action encompassing Firstmerit Corp (NASDAQ:FMER).
How are hedge funds trading Firstmerit Corp (NASDAQ:FMER)?
At year’s end, a total of 12 of the hedge funds we track held long positions in this stock, a change of -8% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were boosting their stakes substantially.
According to our comprehensive database, Fisher Asset Management, managed by Ken Fisher, holds the most valuable position in Firstmerit Corp (NASDAQ:FMER). Fisher Asset Management has a $40.9 million position in the stock, comprising 0.1% of its 13F portfolio. On Fisher Asset Management’s heels is Dreman Value Management, managed by David Dreman, which held a $30.3 million position; 0.9% of its 13F portfolio is allocated to the stock. Some other hedge funds that hold long positions include Jim Simons’s Renaissance Technologies, John Overdeck and David Siegel’s Two Sigma Advisors and Ken Griffin’s Citadel Investment Group.
Since Firstmerit Corp (NASDAQ:FMER) has witnessed falling interest from the entirety of the hedge funds we track, we can see that there was a specific group of hedgies who were dropping their positions entirely heading into 2013. Intriguingly, Brian Taylor’s Pine River Capital Management dropped the largest investment of the 450+ funds we track, worth an estimated $3.9 million in stock., and D. E. Shaw of D E Shaw was right behind this move, as the fund said goodbye to about $0.8 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 1 funds heading into 2013.
What do corporate executives and insiders think about Firstmerit Corp (NASDAQ:FMER)?
Insider trading activity, especially when it’s bullish, is particularly usable when the company we’re looking at has seen transactions within the past six months. Over the last half-year time frame, Firstmerit Corp (NASDAQ:FMER) has seen 4 unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Firstmerit Corp (NASDAQ:FMER). These stocks are Associated Banc Corp (NASDAQ:ASBC), MB Financial, Inc. (NASDAQ:MBFI), Wintrust Financial Corp (NASDAQ:WTFC), Old National Bancorp (NYSE:ONB), and PrivateBancorp Inc (NASDAQ:PVTB). This group of stocks belong to the regional – midwest banks industry and their market caps are closest to FMER’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Associated Banc Corp (NASDAQ:ASBC) | 7 | 3 | 1 |
| MB Financial, Inc. (NASDAQ:MBFI) | 18 | 0 | 3 |
| Wintrust Financial Corp (NASDAQ:WTFC) | 6 | 0 | 4 |
| Old National Bancorp (NYSE:ONB) | 12 | 4 | 0 |
| PrivateBancorp Inc (NASDAQ:PVTB) | 16 | 3 | 0 |
With the results demonstrated by Insider Monkey’s research, everyday investors must always monitor hedge fund and insider trading sentiment, and Firstmerit Corp (NASDAQ:FMER) applies perfectly to this mantra.
