Cemex SAB de CV (ADR) (NYSE:CX) investors should pay attention to an increase in support from the world's most elite money managers lately.
If you'd ask most traders, hedge funds are viewed as slow, outdated investment vehicles of years past. While there are more than 8000 funds with their doors open today, we choose to focus on the moguls of this group, close to 450 funds. It is widely believed that this group controls the majority of all hedge funds' total capital, and by watching their top investments, we have brought to light a few investment strategies that have historically beaten the S&P 500 index. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually 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 outpaced the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).
Just as key, bullish insider trading activity is another way to break down the stock market universe. Obviously, there are many motivations for an upper level exec to cut shares of his or her company, but just one, very simple reason why they would behave bullishly. Several empirical studies have demonstrated the valuable potential of this strategy if piggybackers know where to look (learn more here).
With all of this in mind, we're going to take a gander at the latest action encompassing Cemex SAB de CV (ADR) (NYSE:CX).
In preparation for this year, a total of 28 of the hedge funds we track were bullish in this stock, a change of 40% from the third quarter. With the smart money's positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their stakes considerably.
Of the funds we track, Southeastern Asset Management, managed by Mason Hawkins, holds the most valuable position in Cemex SAB de CV (ADR) (NYSE:CX). Southeastern Asset Management has a $790 million position in the stock, comprising 3.5% of its 13F portfolio. Coming in second is Sean Cullinan of Point State Capital, with a $101 million position; the fund has 1.5% of its 13F portfolio invested in the stock. Some other peers that are bullish include Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital, John Lykouretzos's Hoplite Capital Management and D. E. Shaw's D E Shaw.
As industrywide interest jumped, key money managers were leading the bulls' herd. Hoplite Capital Management, managed by John Lykouretzos, assembled the largest position in Cemex SAB de CV (ADR) (NYSE:CX). Hoplite Capital Management had 44 million invested in the company at the end of the quarter. D. E. Shaw's D E Shaw also initiated a $42 million position during the quarter. The other funds with brand new CX positions are Roberto Mignone's Bridger Management, Stanley Druckenmiller's Duquesne Capital, and Clint Carlson's Carlson Capital.
Insider buying is most useful when the company in focus has experienced transactions within the past six months. Over the latest six-month time period, Cemex SAB de CV (ADR) (NYSE:CX) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
With the results shown by the aforementioned studies, everyday investors must always keep an eye on hedge fund and insider trading sentiment, and Cemex SAB de CV (ADR) (NYSE:CX) is no exception.
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.