ARM Holdings plc (ADR) (NASDAQ:ARMH) was in 23 hedge funds’ portfolio at the end of the first quarter of 2013. ARMH investors should be aware of an increase in hedge fund sentiment recently. There were 18 hedge funds in our database with ARMH holdings at the end of the previous quarter.
To the average investor, there are tons of metrics shareholders can use to track Mr. Market. Some of the best are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite investment managers can outpace the broader indices by a healthy margin (see just how much).
Equally as integral, positive insider trading activity is a second way to parse down the investments you’re interested in. As the old adage goes: there are lots of incentives for a corporate insider to sell shares of his or her company, but just one, very clear reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the useful potential of this strategy if shareholders know what to do (learn more here).
Now, let’s take a glance at the latest action regarding ARM Holdings plc (ADR) (NASDAQ:ARMH).
Hedge fund activity in ARM Holdings plc (ADR) (NASDAQ:ARMH)
In preparation for this quarter, a total of 23 of the hedge funds we track were bullish in this stock, a change of 28% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their stakes meaningfully.
Of the funds we track, John Thaler’s JAT Capital Management had the biggest position in ARM Holdings plc (ADR) (NASDAQ:ARMH), worth close to $82.8 million, comprising 4.1% of its total 13F portfolio. The second largest stake is held by Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, which held a $49.5 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Paul Reeder and Edward Shapiro’s PAR Capital Management, and Daniel Benton’s Andor Capital Management.
Now, key money managers have been driving this bullishness. GLG Partners, managed by Noam Gottesman, established the biggest call position in ARM Holdings plc (ADR) (NASDAQ:ARMH). GLG Partners had 26 million invested in the company at the end of the quarter. Daniel Benton’s Andor Capital Management also initiated a $23.3 million position during the quarter. The other funds with new positions in the stock are Scott Fine and Peter Richards’s Empire Capital Management, Israel Englander’s Millennium Management, and Dmitry Balyasny’s Balyasny Asset Management.
How have insiders been trading ARM Holdings plc (ADR) (NASDAQ:ARMH)?
Insider buying is most useful when the primary stock in question has experienced transactions within the past six months. Over the latest 180-day time period, ARM Holdings plc (ADR) (NASDAQ:ARMH) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to ARM Holdings plc (ADR) (NASDAQ:ARMH). These stocks are LSI Corp (NASDAQ:LSI), Microchip Technology Inc. (NASDAQ:MCHP), NVIDIA Corporation (NASDAQ:NVDA), Linear Technology Corporation (NASDAQ:LLTC), and Altera Corporation (NASDAQ:ALTR). This group of stocks are the members of the semiconductor – specialized industry and their market caps resemble ARMH’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| LSI Corp (NASDAQ:LSI) | 22 | 0 | 1 |
| Microchip Technology Inc. (NASDAQ:MCHP) | 24 | 0 | 11 |
| NVIDIA Corporation (NASDAQ:NVDA) | 29 | 0 | 1 |
| Linear Technology Corporation (NASDAQ:LLTC) | 23 | 0 | 14 |
| Altera Corporation (NASDAQ:ALTR) | 25 | 0 | 3 |
With the results exhibited by our studies, retail investors should always watch hedge fund and insider trading sentiment, and ARM Holdings plc (ADR) (NASDAQ:ARMH) is no exception.
