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Hedge Funds Are Betting On Alnylam Pharmaceuticals, Inc. (ALNY): Arena Pharmaceuticals, Inc. (ARNA), Acorda Therapeutics Inc (ACOR)

Is Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) a first-rate stock to buy now? Investors who are in the know are turning bullish. The number of bullish hedge fund positions rose by 1 in recent months.

7 Biotech Stocks Trading At Steep Discount To Target PriceTo most stock holders, hedge funds are seen as worthless, old investment vehicles of yesteryear. While there are greater than 8000 funds in operation today, we look at the crème de la crème of this group, around 450 funds. It is widely believed that this group has its hands on the lion’s share of all hedge funds’ total capital, and by watching their top equity investments, we have formulated a number of investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 25 percentage points in 6.5 month (check out a sample of our picks).

Just as integral, bullish insider trading sentiment is another way to parse down the financial markets. Just as you’d expect, there are plenty of motivations for an executive to sell shares of his or her company, but just one, very clear reason why they would behave bullishly. Various empirical studies have demonstrated the useful potential of this strategy if investors know what to do (learn more here).

Consequently, we’re going to take a peek at the latest action regarding Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY).

Hedge fund activity in Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY)

Heading into 2013, a total of 10 of the hedge funds we track were bullish in this stock, a change of 11% from one quarter earlier. With hedgies’ capital changing hands, there exists a few key hedge fund managers who were boosting their stakes considerably.

Of the funds we track, Bridger Management, managed by Roberto Mignone, holds the most valuable position in Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY). Bridger Management has a $36 million position in the stock, comprising 2.6% of its 13F portfolio. Sitting at the No. 2 spot is Healthcor Management LP, managed by Arthur B Cohen and Joseph Healey, which held a $33 million position; 0.1% of its 13F portfolio is allocated to the stock. Some other hedgies with similar optimism include Ken Griffin’s Citadel Investment Group, Steven Cohen’s SAC Capital Advisors and Richard Driehaus’s Driehaus Capital.

With a general bullishness amongst the heavyweights, specific money managers have jumped into Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) headfirst. Ellington, managed by Mike Vranos, created the largest position in Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY). Ellington had 0 million invested in the company at the end of the quarter.

What do corporate executives and insiders think about Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY)?

Insider purchases made by high-level executives is at its handiest when the primary stock in question has seen transactions within the past six months. Over the last six-month time frame, Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) has seen 1 unique insiders purchasing, and 6 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY). These stocks are Arena Pharmaceuticals, Inc. (NASDAQ:ARNA), Acorda Therapeutics Inc (NASDAQ:ACOR), ImmunoGen, Inc. (NASDAQ:IMGN), Viropharma Inc (NASDAQ:VPHM), and Synageva BioPharma Corp (NASDAQ:GEVA). This group of stocks belong to the biotechnology industry and their market caps are similar to ALNY’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) 11 0 1
Acorda Therapeutics Inc (NASDAQ:ACOR) 10 0 7
ImmunoGen, Inc. (NASDAQ:IMGN) 5 1 2
Viropharma Inc (NASDAQ:VPHM) 20 1 5
Synageva BioPharma Corp (NASDAQ:GEVA) 6 3 5

With the returns demonstrated by the aforementioned strategies, everyday investors must always monitor hedge fund and insider trading activity, and Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY) is an important part of this process.

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

Insider Monkey’s small-cap strategy returned 37% between September 2012 and March 2013 versus 12.9% for the S&P 500 index. Try it now by clicking the link above.

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