American Financial Group (AFG): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Page 1 of 2

American Financial Group (NYSE:AFG)American Financial Group (NYSE:AFG) has experienced an increase in hedge fund interest recently.

If you’d ask most market participants, hedge funds are seen as worthless, old investment tools of years past. While there are greater than 8000 funds with their doors open at the moment, we choose to focus on the aristocrats of this club, about 450 funds. It is estimated that this group has its hands on most of the smart money’s total asset base, and by monitoring their highest performing picks, we have unearthed a few investment strategies that have historically outpaced the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per year 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 outperformed the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).

Just as integral, positive insider trading sentiment is a second way to parse down the marketplace. Obviously, there are a variety of incentives for an executive to downsize shares of his or her company, but just one, very simple reason why they would initiate a purchase. Many academic studies have demonstrated the useful potential of this tactic if you know what to do (learn more here).

Keeping this in mind, it’s important to take a peek at the latest action encompassing American Financial Group (NYSE:AFG).

Hedge fund activity in American Financial Group (NYSE:AFG)

At the end of the fourth quarter, a total of 10 of the hedge funds we track were bullish in this stock, a change of 25% from the previous quarter. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes considerably.

According to our comprehensive database, Citadel Investment Group, managed by Ken Griffin, holds the largest position in American Financial Group (NYSE:AFG). Citadel Investment Group has a $62.5 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is AQR Capital Management, managed by Cliff Asness, which held a $36.7 million position; 0.2% of its 13F portfolio is allocated to the company. Other peers with similar optimism include SAC Subsidiary’s CR Intrinsic Investors, Israel Englander’s Millennium Management and Steven Cohen’s SAC Capital Advisors.

Now, key money managers were breaking ground themselves. CR Intrinsic Investors, managed by SAC Subsidiary, created the biggest position in American Financial Group (NYSE:AFG). CR Intrinsic Investors had 9.7 million invested in the company at the end of the quarter. Steven Cohen’s SAC Capital Advisors also made a $5.4 million investment in the stock during the quarter. The only other fund with a brand new AFG position is Gregory Fraser, Rudolph Kluiber, and Timothy Kroch’s GRT Capital Partners.

Insider trading activity in American Financial Group (NYSE:AFG)

Insider trading activity, especially when it’s bullish, is at its handiest when the company in question has experienced transactions within the past half-year. Over the latest 180-day time period, American Financial Group (NYSE:AFG) has seen zero unique insiders purchasing, and 10 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to American Financial Group (NYSE:AFG). These stocks are White Mountains Insurance Group Ltd (NYSE:WTM), Markel Corporation (NYSE:MKL), RenaissanceRe Holdings Ltd. (NYSE:RNR), Validus Holdings, Ltd. (NYSE:VR), and HCC Insurance Holdings, Inc. (NYSE:HCC). This group of stocks belong to the property & casualty insurance industry and their market caps are closest to AFG’s market cap.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

Top 15 Best Paying Jobs for Women in 2014

Top 6 Things Rich People Do Differently Every Day

5 Retirement Mistakes To Avoid (and Einstein’s Famous Quote)

11 Smartest People in the World

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top 6 Tax Scams and How to Protect Yourself

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!