AU Optronics Corp. (ADR) (NYSE:AUO) investors should pay attention to an increase in activity from the world’s largest hedge funds recently.
At the moment, there are dozens of metrics shareholders can use to track publicly traded companies. Two of the most under-the-radar are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite hedge fund managers can beat the market by a significant margin (see just how much).
Just as key, bullish insider trading activity is another way to parse down the world of equities. Just as you’d expect, there are lots of incentives for an executive to sell shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several empirical studies have demonstrated the market-beating potential of this method if “monkeys” understand what to do (learn more here).
With all of this in mind, it’s important to take a gander at the latest action encompassing AU Optronics Corp. (ADR) (NYSE:AUO).
What have hedge funds been doing with AU Optronics Corp. (ADR) (NYSE:AUO)?
Heading into 2013, a total of 6 of the hedge funds we track held long positions in this stock, a change of 20% from the third quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their holdings significantly.
According to our comprehensive database, Jim Simons’s Renaissance Technologies had the largest position in AU Optronics Corp. (ADR) (NYSE:AUO), worth close to $1.7 million, accounting for less than 0.1%% of its total 13F portfolio. On Renaissance Technologies’s heels is Israel Englander of Millennium Management, with a $0.6 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Remaining hedge funds that are bullish include Bruce Kovner’s Caxton Associates LP, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and D. E. Shaw’s D E Shaw.
As aggregate interest increased, some big names have been driving this bullishness. Millennium Management, managed by Israel Englander, created the largest position in AU Optronics Corp. (ADR) (NYSE:AUO). Millennium Management had 0.6 million invested in the company at the end of the quarter. Bruce Kovner’s Caxton Associates LP also initiated a $0.2 million position during the quarter. The other funds with new positions in the stock are Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and John Overdeck and David Siegel’s Two Sigma Advisors.
What have insiders been doing with AU Optronics Corp. (ADR) (NYSE:AUO)?
Insider trading activity, especially when it’s bullish, is at its handiest when the primary stock in question has seen transactions within the past half-year. Over the latest 180-day time period, AU Optronics Corp. (ADR) (NYSE:AUO) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to AU Optronics Corp. (ADR) (NYSE:AUO). These stocks are STMicroelectronics N.V. (ADR) (NYSE:STM), Mellanox Technologies, Ltd. (NASDAQ:MLNX), Atmel Corporation (NASDAQ:ATML), ON Semiconductor Corp (NASDAQ:ONNN), and Freescale Semiconductor Ltd (NYSE:FSL). This group of stocks are the members of the semiconductor – broad line industry and their market caps match AUO’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|STMicroelectronics N.V. (ADR) (NYSE:STM)||9||0||0|
|Mellanox Technologies, Ltd. (NASDAQ:MLNX)||21||0||8|
|Atmel Corporation (NASDAQ:ATML)||17||0||3|
|ON Semiconductor Corp (NASDAQ:ONNN)||15||0||5|
|Freescale Semiconductor Ltd (NYSE:FSL)||7||0||9|
With the results exhibited by Insider Monkey’s tactics, everyday investors must always pay attention to hedge fund and insider trading activity, and AU Optronics Corp. (ADR) (NYSE:AUO) shareholders fit into this picture quite nicely.