NovaGold Resources Inc. (USA) (NYSEAMEX:NG) investors should pay attention to a decrease in support from the world’s most elite money managers of late.
In the financial world, there are tons of gauges shareholders can use to watch the equity markets. A couple of the best are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best fund managers can beat the S&P 500 by a solid amount (see just how much).
Just as important, positive insider trading activity is another way to parse down the marketplace. Just as you’d expect, there are many stimuli for a bullish insider to sell shares of his or her company, but only one, very simple reason why they would buy. Plenty of empirical studies have demonstrated the valuable potential of this strategy if you understand where to look (learn more here).
Now, it’s important to take a gander at the key action regarding NovaGold Resources Inc. (USA) (NYSEAMEX:NG).
What have hedge funds been doing with NovaGold Resources Inc. (USA) (NYSEAMEX:NG)?
In preparation for this quarter, a total of 13 of the hedge funds we track were long in this stock, a change of -19% from one quarter earlier. With hedge funds’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were boosting their holdings substantially.
When looking at the hedgies we track, Paulson & Co, managed by John Paulson, holds the most valuable position in NovaGold Resources Inc. (USA) (NYSEAMEX:NG). Paulson & Co has a $130.4 million position in the stock, comprising 0.7% of its 13F portfolio. The second largest stake is held by Seth Klarman of Baupost Group, with a $78.7 million position; 2.5% of its 13F portfolio is allocated to the stock. Other peers that are bullish include Jeffrey Vinik’s Vinik Asset Management, Michael Kaufman’s MAK Capital One and Peter Franklin Palmedo’s Sun Valley Gold.
Due to the fact that NovaGold Resources Inc. (USA) (NYSEAMEX:NG) has witnessed declining sentiment from the entirety of the hedge funds we track, it’s easy to see that there lies a certain “tier” of hedge funds that decided to sell off their entire stakes at the end of the first quarter. Intriguingly, Murray Stahl’s Horizon Asset Management sold off the largest stake of the 450+ funds we watch, totaling close to $3 million in stock., and Morris Mark of Mark Asset Management was right behind this move, as the fund sold off about $1.2 million worth. These transactions are interesting, as total hedge fund interest dropped by 3 funds at the end of the first quarter.
Insider trading activity in NovaGold Resources Inc. (USA) (NYSEAMEX:NG)
Insider purchases made by high-level executives is particularly usable when the company in focus has seen transactions within the past 180 days. Over the latest half-year time frame, NovaGold Resources Inc. (USA) (NYSEAMEX:NG) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
With the results exhibited by Insider Monkey’s strategies, retail investors should always pay attention to hedge fund and insider trading activity, and NovaGold Resources Inc. (USA) (NYSEAMEX:NG) shareholders fit into this picture quite nicely.