In the financial world, there are tons of methods investors can use to track Mr. Market. A couple of the best are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best fund managers can outclass the market by a superb margin (see just how much).
Equally as necessary, optimistic insider trading sentiment is a second way to look at the financial markets. As the old adage goes: there are plenty of reasons for an upper level exec to get rid of shares of his or her company, but only one, very simple reason why they would initiate a purchase. Plenty of academic studies have demonstrated the impressive potential of this tactic if investors know where to look (learn more here).
Furthermore, let’s study the latest info about Allison Transmission Holdings Inc (NYSE:ALSN).
What have hedge funds been doing with Allison Transmission Holdings Inc (NYSE:ALSN)?
In preparation for the third quarter, a total of 7 of the hedge funds we track were long in this stock, a change of 17% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were boosting their stakes significantly.
Out of the hedge funds we follow, Scout Capital Management, managed by James Crichton and Adam Weiss, holds the biggest position in Allison Transmission Holdings Inc (NYSE:ALSN). Scout Capital Management has a $126.9 million position in the stock, comprising 2.1% of its 13F portfolio. Sitting at the No. 2 spot is Clough Capital Partners, managed by Charles Clough, which held a $34.1 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Other hedge funds that hold long positions include Phill Gross and Robert Atchinson’s Adage Capital Management, Bill Miller’s Legg Mason Capital Management and D. E. Shaw’s D E Shaw.
As industrywide interest increased, certain bigger names were breaking ground themselves. Scout Capital Management, managed by James Crichton and Adam Weiss, established the most outsized position in Allison Transmission Holdings Inc (NYSE:ALSN). Scout Capital Management had 126.9 million invested in the company at the end of the quarter. Charles Clough’s Clough Capital Partners also initiated a $34.1 million position during the quarter. The other funds with new positions in the stock are Phill Gross and Robert Atchinson’s Adage Capital Management, Bill Miller’s Legg Mason Capital Management, and D. E. Shaw’s D E Shaw.
How are insiders trading Allison Transmission Holdings Inc (NYSE:ALSN)?
Insider buying is best served when the primary stock in question has seen transactions within the past half-year. Over the latest 180-day time frame, Allison Transmission Holdings Inc (NYSE:ALSN) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We’ll check out the relationship between both of these indicators in other stocks similar to Allison Transmission Holdings Inc (NYSE:ALSN). These stocks are Visteon Corp (NYSE:VC), TRW Automotive Holdings Corp. (NYSE:TRW), LKQ Corporation (NASDAQ:LKQ), Lear Corporation (NYSE:LEA), and WABCO Holdings Inc. (NYSE:WBC). All of these stocks are in the auto parts industry and their market caps are similar to ALSN’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Visteon Corp (NYSE:VC) | 41 | 0 | 0 |
| TRW Automotive Holdings Corp. (NYSE:TRW) | 36 | 0 | 0 |
| LKQ Corporation (NASDAQ:LKQ) | 21 | 0 | 0 |
| Lear Corporation (NYSE:LEA) | 39 | 0 | 0 |
| WABCO Holdings Inc. (NYSE:WBC) | 33 | 0 | 0 |
Using the results demonstrated by the previously mentioned analyses, average investors must always watch hedge fund and insider trading activity, and Allison Transmission Holdings Inc (NYSE:ALSN) is an important part of this process.
