To many market players, hedge funds are viewed as useless, outdated investment vehicles of a forgotten age. Although there are more than 8,000 hedge funds with their doors open in present day, Insider Monkey focuses on the crème de la crème of this group, close to 525 funds. Analysts calculate that this group controls the majority of the smart money’s total capital, and by monitoring their highest performing investments, we’ve unearthed a number of investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points a 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 outclassed the S&P 500 index by 33 percentage points in 11 months (find a sample of our picks).
Equally as crucial, optimistic insider trading sentiment is a second way to look at the world of equities. Obviously, there are plenty of stimuli for an insider to sell shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Many academic studies have demonstrated the useful potential of this strategy if piggybackers know where to look (learn more here).
Thus, let’s examine the recent info surrounding The Bank of New York Mellon Corporation (NYSE:BK).
What does the smart money think about The Bank of New York Mellon Corporation (NYSE:BK)?
At Q2’s end, a total of 39 of the hedge funds we track were bullish in this stock, a change of 15% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their stakes substantially.
When using filings from the managers we track, Mason Hawkins’s Southeastern Asset Management had the largest position in The Bank of New York Mellon Corporation (NYSE:BK), worth close to $1.1936 billion, comprising 5.9% of its total 13F portfolio. The second largest stake is held by First Eagle Investment Management, managed by Matt McLennan, which held a $701.9 million position; the fund has 2.1% of its 13F portfolio invested in the stock. Other hedgies that hold long positions include Warren Buffett’s Berkshire Hathaway, Martin Whitman’s Third Avenue Management and Donald Yacktman’s Yacktman Asset Management.
Now, particular funds were leading the bulls’ herd. Southeastern Asset Management, managed by Mason Hawkins, assembled the most outsized position in The Bank of New York Mellon Corporation (NYSE:BK). Southeastern Asset Management had 1.1936 billion invested in the company at the end of the quarter. Matt McLennan’s First Eagle Investment Management also made a $701.9 million investment in the stock during the quarter. The following funds were also among the new BK investors: Warren Buffett’s Berkshire Hathaway, Martin Whitman’s Third Avenue Management, and Donald Yacktman’s Yacktman Asset Management.
How have insiders been trading The Bank of New York Mellon Corporation (NYSE:BK)?
Insider buying is most useful when the company we’re looking at has experienced transactions within the past half-year. Over the last six-month time period, The Bank of New York Mellon Corporation (NYSE:BK) has seen zero unique insiders purchasing, and 2 insider sales (see the details of insider trades here).
We’ll also review the relationship between both of these indicators in other stocks similar to The Bank of New York Mellon Corporation (NYSE:BK). These stocks are T. Rowe Price Group, Inc. (NASDAQ:TROW), The Blackstone Group L.P. (NYSE:BX), BlackRock, Inc. (NYSE:BLK), State Street Corporation (NYSE:STT), and Franklin Resources, Inc. (NYSE:BEN). This group of stocks are in the asset management industry and their market caps resemble BK’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| T. Rowe Price Group, Inc. (NASDAQ:TROW) | 29 | 0 | 2 |
| The Blackstone Group L.P. (NYSE:BX) | 31 | 0 | 2 |
| BlackRock, Inc. (NYSE:BLK) | 26 | 1 | 3 |
| State Street Corporation (NYSE:STT) | 32 | 0 | 8 |
| Franklin Resources, Inc. (NYSE:BEN) | 39 | 0 | 3 |
Using the results shown by the previously mentioned tactics, regular investors must always keep one eye on hedge fund and insider trading activity, and The Bank of New York Mellon Corporation (NYSE:BK) is no exception.
