Eaton Corporation, PLC Ordinary Shares (NYSE:ETN): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Eaton Corporation, PLC Ordinary Shares (NYSE:ETN) was in 33 hedge funds’ portfolio at the end of December. ETN has seen an increase in hedge fund interest of late. There were 31 hedge funds in our database with ETN holdings at the end of the previous quarter.

According to most traders, hedge funds are assumed to be slow, old investment tools of yesteryear. While there are over 8000 funds in operation at the moment, we look at the moguls of this club, around 450 funds. It is widely believed that this group has its hands on most of all hedge funds’ total asset base, and by tracking their top equity investments, we have formulated a number of investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outperformed 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 outperformed the S&P 500 index by 25 percentage points in 6.5 month (see the details here).

CITADEL INVESTMENT GROUPJust as key, positive insider trading sentiment is another way to parse down the investments you’re interested in. There are a variety of reasons for a corporate insider to drop shares of his or her company, but only one, very obvious reason why they would buy. Many empirical studies have demonstrated the useful potential of this method if piggybackers know where to look (learn more here).

Keeping this in mind, it’s important to take a glance at the key action regarding Eaton Corporation, PLC Ordinary Shares (NYSE:ETN).

What have hedge funds been doing with Eaton Corporation, PLC Ordinary Shares (NYSE:ETN)?

At year’s end, a total of 33 of the hedge funds we track were long in this stock, a change of 6% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their holdings substantially.

When looking at the hedgies we track, Levin Capital Strategies, managed by John A. Levin, holds the largest position in Eaton Corporation, PLC Ordinary Shares (NYSE:ETN). Levin Capital Strategies has a $230 million position in the stock, comprising 4.6% of its 13F portfolio. Coming in second is Citadel Investment Group, managed by Ken Griffin, which held a $202 million position; 6.9% of its 13F portfolio is allocated to the company. Some other hedge funds that are bullish include Christopher MedlockáJames’s Partner Fund Management, Steven Cohen’s SAC Capital Advisors and Thomas E. Claugus’s GMT Capital.

With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Partner Fund Management, managed by Christopher MedlockáJames, created the most outsized position in Eaton Corporation, PLC Ordinary Shares (NYSE:ETN). Partner Fund Management had 163 million invested in the company at the end of the quarter. Glenn Russell Dubin’s Highbridge Capital Management also initiated a $51 million position during the quarter. The following funds were also among the new ETN investors: Anand Parekh’s Alyeska Investment Group, Douglas Dillard Jr. and Raj D. Venkatesan’s Standard Pacific Capital, and Larry Foley and Paul Farrell’s Bronson Point Partners.

How are insiders trading Eaton Corporation, PLC Ordinary Shares (NYSE:ETN)?

Insider buying is best served when the company in question has seen transactions within the past six months. Over the latest half-year time frame, Eaton Corporation, PLC Ordinary Shares (NYSE:ETN) has experienced zero unique insiders purchasing, and 8 insider sales (see the details of insider trades here).

With the returns shown by the aforementioned research, retail investors must always watch hedge fund and insider trading sentiment, and Eaton Corporation, PLC Ordinary Shares (NYSE:ETN) applies perfectly to this mantra.

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.

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

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Top 10 Highest Paying Jobs in the World

Most Expensive Day-Care in New York City

The 10 Cheapest Places to Retire Abroad

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!