Do Hedge Funds and Insiders Love EZchip Semiconductor Ltd. (EZCH)?

Is EZchip Semiconductor Ltd. (NASDAQ:EZCH) the right investment to pursue these days? Money managers are in a bullish mood. The number of long hedge fund bets moved up by 1 recently.

To most market participants, hedge funds are seen as underperforming, outdated financial vehicles of yesteryear. While there are over 8000 funds in operation at the moment, we at Insider Monkey look at the crème de la crème of this group, about 450 funds. Most estimates calculate that this group has its hands on most of the smart money’s total asset base, and by watching their top investments, we have figured out a few investment strategies that have historically beaten the broader indices. 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 outclassed the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).

Equally as integral, optimistic insider trading sentiment is a second way to parse down the investments you’re interested in. As the old adage goes: there are a number of stimuli for an insider to sell shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Plenty of academic studies have demonstrated the impressive potential of this strategy if you know where to look (learn more here).

With these “truths” under our belt, it’s important to take a look at the latest action surrounding EZchip Semiconductor Ltd. (NASDAQ:EZCH).

How are hedge funds trading EZchip Semiconductor Ltd. (NASDAQ:EZCH)?

Heading into 2013, a total of 7 of the hedge funds we track held long positions in this stock, a change of 17% from the third quarter. With hedge funds’ sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their holdings meaningfully.

EZchip Semiconductor Ltd. (NASDAQ:EZCH)When looking at the hedgies we track, Columbus Circle Investors, managed by Donald Chiboucis, holds the most valuable position in EZchip Semiconductor Ltd. (NASDAQ:EZCH). Columbus Circle Investors has a $33.3 million position in the stock, comprising 0.3% of its 13F portfolio. Coming in second is Ryan Frick and Oliver Evans of Dorsal Capital Management, with a $29.8 million position; the fund has 3.9% of its 13F portfolio invested in the stock. Some other peers with similar optimism include Jeffrey Vinik’s Vinik Asset Management, D. E. Shaw’s D E Shaw and Joseph A. Jolson’s Harvest Capital Strategies.

Consequently, specific money managers have been driving this bullishness. Vinik Asset Management, managed by Jeffrey Vinik, initiated the most valuable position in EZchip Semiconductor Ltd. (NASDAQ:EZCH). Vinik Asset Management had 8 million invested in the company at the end of the quarter.

How have insiders been trading EZchip Semiconductor Ltd. (NASDAQ:EZCH)?

Insider buying is particularly usable when the primary stock in question has experienced transactions within the past 180 days. Over the last 180-day time frame, EZchip Semiconductor Ltd. (NASDAQ:EZCH) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to EZchip Semiconductor Ltd. (NASDAQ:EZCH). These stocks are Cabot Microelectronics Corporation (NASDAQ:CCMP), Amkor Technology, Inc. (NASDAQ:AMKR), Micrel, Incorporated (NASDAQ:MCRL), OmniVision Technologies, Inc. (NASDAQ:OVTI), and Aeroflex Holding Corp. (NYSE:ARX). This group of stocks belong to the semiconductor – integrated circuits industry and their market caps are similar to EZCH’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Cabot Microelectronics Corporation (NASDAQ:CCMP) 5 0 13
Amkor Technology, Inc. (NASDAQ:AMKR) 11 0 0
Micrel, Incorporated (NASDAQ:MCRL) 6 2 1
OmniVision Technologies, Inc. (NASDAQ:OVTI) 17 0 2
Aeroflex Holding Corp. (NYSE:ARX) 7 2 0

With the returns shown by Insider Monkey’s strategies, retail investors must always pay attention to hedge fund and insider trading sentiment, and EZchip Semiconductor Ltd. (NASDAQ:EZCH) is an important part of this process.

Click here to learn why you should track hedge funds

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

The 10 Longest Wars of All Time

The 13 Worst Looking Foods that Taste Great

The 6 Most Gruesome Injuries Suffered During a Sports Match

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!