In the financial world, there are a multitude of indicators investors can use to analyze their holdings. A couple of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top money managers can trounce the S&P 500 by a healthy amount (see just how much).
Equally as useful, optimistic insider trading activity is a second way to analyze the stock market universe. There are plenty of incentives for a corporate insider to sell shares of his or her company, but just one, very clear reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this strategy if you know where to look (learn more here).
What's more, we're going to discuss the latest info about AK Steel Holding Corporation (NYSE:AKS).
At Q2's end, a total of 12 of the hedge funds we track were long in this stock, a change of -14% from one quarter earlier. With the smart money's capital changing hands, there exists a select group of noteworthy hedge fund managers who were boosting their holdings substantially.
When using filings from the hedgies we track, AQR Capital Management, managed by Cliff Asness, holds the largest position in AK Steel Holding Corporation (NYSE:AKS). AQR Capital Management has a $7.1 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Martin Whitman of Third Avenue Management, with a $2.2 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Brian Taylor's Pine River Capital Management, Peter Troob's Troob Capital Management and D. E. Shaw's D E Shaw.
Because AK Steel Holding Corporation (NYSE:AKS) has witnessed bearish sentiment from the entirety of the hedge funds we track, it's safe to say that there was a specific group of hedgies that elected to cut their entire stakes last quarter. At the top of the heap, Matthew Tewksbury's Stevens Capital Management sold off the largest stake of all the hedgies we track, totaling close to $0.5 million in call options.. Matthew Hulsizer's fund, PEAK6 Capital Management, also sold off its call options., about $0.1 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 2 funds last quarter.
Legal insider trading, particularly when it's bullish, is best served when the company in focus has seen transactions within the past 180 days. Over the last half-year time period, AK Steel Holding Corporation (NYSE:AKS) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We'll also take a look at the relationship between both of these indicators in other stocks similar to AK Steel Holding Corporation (NYSE:AKS). These stocks are Universal Stainless & Alloy Products (NASDAQ:USAP), Metals USA Holdings Corp (NYSE:MUSA), Northwest Pipe Company (NASDAQ:NWPX), Insteel Industries Inc (NASDAQ:IIIN), and Gibraltar Industries Inc (NASDAQ:ROCK). This group of stocks are in the steel & iron industry and their market caps are similar to AKS's market cap.