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Continental Resources, Inc. (NYSE:CLR): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Continental Resources, Inc. (NYSE:CLR) investors should be aware of an increase in hedge fund sentiment of late.

The Definitive Guide to FrackingAt the moment, there are a multitude of gauges market participants can use to watch publicly traded companies. A duo of the best are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can trounce the S&P 500 by a superb amount (see just how much).

Equally as key, bullish insider trading sentiment is another way to parse down the financial markets. There are plenty of incentives for an insider to cut shares of his or her company, but just one, very clear reason why they would behave bullishly. Plenty of empirical studies have demonstrated the impressive potential of this strategy if piggybackers know what to do (learn more here).

Consequently, it’s important to take a look at the key action encompassing Continental Resources, Inc. (NYSE:CLR).

What have hedge funds been doing with Continental Resources, Inc. (NYSE:CLR)?

Heading into 2013, a total of 20 of the hedge funds we track held long positions in this stock, a change of 5% from the third quarter. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes considerably.

Of the funds we track, SAC Capital Advisors, managed by Steven Cohen, holds the biggest position in Continental Resources, Inc. (NYSE:CLR). SAC Capital Advisors has a $120 million position in the stock, comprising 0.6% of its 13F portfolio. Coming in second is Citadel Investment Group, managed by Ken Griffin, which held a $107 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining hedgies that are bullish include Andrew Hall’s Astenbeck Capital Management, SAC Subsidiary’s Sigma Capital Management and Jeffrey Vinik’s Vinik Asset Management.

Now, key hedge funds have jumped into Continental Resources, Inc. (NYSE:CLR) headfirst. Renaissance Technologies, managed by Jim Simons, established the most outsized position in Continental Resources, Inc. (NYSE:CLR). Renaissance Technologies had 16 million invested in the company at the end of the quarter. Mark Kingdon’s Kingdon Capital also initiated a $7 million position during the quarter. The other funds with brand new CLR positions are Anthony Giammalva’s Sound Energy Partners, Charles Davidson’s Wexford Capital, and Louis Bacon’s Moore Global Investments.

How are insiders trading Continental Resources, Inc. (NYSE:CLR)?

Insider buying is best served when the company we’re looking at has seen transactions within the past half-year. Over the latest half-year time period, Continental Resources, Inc. (NYSE:CLR) has seen zero unique insiders purchasing, and 8 insider sales (see the details of insider trades here).

With the results demonstrated by Insider Monkey’s time-tested strategies, retail investors must always pay attention to hedge fund and insider trading sentiment, and Continental Resources, Inc. (NYSE:CLR) shareholders fit into this picture quite nicely.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.

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