Westlake Chemical Corporation (WLK): Insiders Aren’t Crazy About It

Westlake Chemical Corporation (NYSE:WLK) has experienced an increase in enthusiasm from smart money lately.

In the 21st century investor’s toolkit, there are many methods market participants can use to track their holdings. A couple of the best are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can beat the broader indices by a solid amount (see just how much).

Equally as integral, bullish insider trading activity is another way to break down the investments you’re interested in. Obviously, there are lots of motivations for a corporate insider to drop shares of his or her company, but just one, very clear reason why they would initiate a purchase. Many empirical studies have demonstrated the useful potential of this strategy if piggybackers know where to look (learn more here).

With all of this in mind, it’s important to take a glance at the key action surrounding Westlake Chemical Corporation (NYSE:WLK).

Hedge fund activity in Westlake Chemical Corporation (NYSE:WLK)

In preparation for this quarter, a total of 29 of the hedge funds we track were long in this stock, a change of 21% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their stakes meaningfully.

According to our comprehensive database, Royce & Associates, managed by Chuck Royce, holds the largest position in Westlake Chemical Corporation (NYSE:WLK). Royce & Associates has a $309.8 million position in the stock, comprising 0.9% of its 13F portfolio. Coming in second is Israel Englander of Millennium Management, with a $63 million position; 0.3% of its 13F portfolio is allocated to the stock. Other peers that hold long positions include John Burbank’s Passport Capital, Jeffrey Vinik’s Vinik Asset Management and Sean Cullinan’s Point State Capital.

With a general bullishness amongst the heavyweights, key hedge funds have been driving this bullishness. Adage Capital Management, managed by Phill Gross and Robert Atchinson, initiated the biggest position in Westlake Chemical Corporation (NYSE:WLK). Adage Capital Management had 31.2 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also initiated a $4.7 million position during the quarter. The following funds were also among the new WLK investors: Wayne Cooperman’s Cobalt Capital Management, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Colin Hall and James Davidson’s Long Oar Global Investors.

Insider trading activity in Westlake Chemical Corporation (NYSE:WLK)

Insider purchases made by high-level executives is at its handiest when the primary stock in question has experienced transactions within the past six months. Over the last 180-day time period, Westlake Chemical Corporation (NYSE:WLK) has experienced zero unique insiders buying, and 13 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to Westlake Chemical Corporation (NYSE:WLK). These stocks are Rockwood Holdings, Inc. (NYSE:ROC), The Valspar Corporation (NYSE:VAL), Albemarle Corporation (NYSE:ALB), W.R. Grace & Co. (NYSE:GRA), and International Flavors & Fragrances Inc (NYSE:IFF). This group of stocks are the members of the specialty chemicals industry and their market caps are similar to WLK’s market cap.

With the results demonstrated by the aforementioned tactics, everyday investors should always watch hedge fund and insider trading sentiment, and Westlake Chemical Corporation (NYSE:WLK) applies perfectly to this mantra.

Click here to learn why you should track hedge funds