Moneygram International Inc (NYSE:MGI) was in 9 hedge funds’ portfolio at the end of December. MGI shareholders have witnessed a decrease in activity from the world’s largest hedge funds lately. There were 10 hedge funds in our database with MGI positions at the end of the previous quarter.
To most market participants, hedge funds are viewed as underperforming, old financial tools of yesteryear. While there are greater than 8000 funds with their doors open at the moment, we look at the top tier of this group, around 450 funds. It is widely believed that this group controls the lion’s share of the smart money’s total asset base, and by paying attention to their top equity investments, we have determined a number of investment strategies that have historically outpaced the broader indices. Our small-cap hedge fund strategy outperformed 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 beaten the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).
Just as integral, positive insider trading activity is another way to parse down the financial markets. Obviously, there are a number of incentives for an insider to get rid of shares of his or her company, but just one, very clear reason why they would initiate a purchase. Several academic studies have demonstrated the valuable potential of this strategy if “monkeys” understand what to do (learn more here).
Now, it’s important to take a glance at the key action surrounding Moneygram International Inc (NYSE:MGI).
Hedge fund activity in Moneygram International Inc (NYSE:MGI)
Heading into 2013, a total of 9 of the hedge funds we track were bullish in this stock, a change of -10% from one quarter earlier. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their holdings considerably.
When looking at the hedgies we track, Richard Blum’s Blum Capital Partners had the biggest position in Moneygram International Inc (NYSE:MGI), worth close to $25.9 million, accounting for 4.2% of its total 13F portfolio. Coming in second is Royce & Associates, managed by Chuck Royce, which held a $19.3 million position; 0.1% of its 13F portfolio is allocated to the stock. Some other hedgies with similar optimism include John C. Walker’s Stonerise Capital Management, Jim Simons’s Renaissance Technologies and Ken Griffin’s Citadel Investment Group.
Seeing as Moneygram International Inc (NYSE:MGI) has witnessed a declination in interest from the entirety of the hedge funds we track, we can see that there is a sect of fund managers that slashed their entire stakes at the end of the year. Intriguingly, Neil Chriss’s Hutchin Hill Capital dropped the largest investment of the 450+ funds we key on, comprising an estimated $34.7 million in stock., and Joseph A. Jolson of Harvest Capital Strategies was right behind this move, as the fund sold off about $0.5 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest was cut by 1 funds at the end of the year.
How have insiders been trading Moneygram International Inc (NYSE:MGI)?
Insider buying is particularly usable when the primary stock in question has experienced transactions within the past half-year. Over the latest six-month time period, Moneygram International Inc (NYSE:MGI) has experienced 3 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 Moneygram International Inc (NYSE:MGI). These stocks are Quad/Graphics, Inc. (NYSE:QUAD), TeleTech Holdings, Inc. (NASDAQ:TTEC), NetSpend Holdings Inc (NASDAQ:NTSP), ExlService Holdings, Inc. (NASDAQ:EXLS), and Infoblox Inc (NYSE:BLOX). This group of stocks are the members of the business services industry and their market caps resemble MGI’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Quad/Graphics, Inc. (NYSE:QUAD) | 10 | 0 | 1 |
| TeleTech Holdings, Inc. (NASDAQ:TTEC) | 9 | 0 | 0 |
| NetSpend Holdings Inc (NASDAQ:NTSP) | 7 | 0 | 3 |
| ExlService Holdings, Inc. (NASDAQ:EXLS) | 5 | 0 | 7 |
| Infoblox Inc (NYSE:BLOX) | 12 | 0 | 9 |
With the returns shown by the aforementioned tactics, retail investors must always keep an eye on hedge fund and insider trading sentiment, and Moneygram International Inc (NYSE:MGI) applies perfectly to this mantra.
