HCP, Inc. (NYSE:HCP) has seen an increase in activity from the world's largest hedge funds lately.
At the moment, there are dozens of methods shareholders can use to watch publicly traded companies. Two of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top hedge fund managers can beat their index-focused peers by a superb amount (see just how much).
Equally as key, positive insider trading sentiment is another way to break down the investments you're interested in. Just as you'd expect, there are plenty of stimuli for a bullish insider to sell shares of his or her company, but only one, very obvious reason why they would buy. Various academic studies have demonstrated the useful potential of this tactic if piggybackers understand what to do (learn more here).
Keeping this in mind, it's important to take a look at the recent action encompassing HCP, Inc. (NYSE:HCP).
Heading into 2013, a total of 19 of the hedge funds we track were bullish in this stock, a change of 58% from the third quarter. With the smart money's capital changing hands, there exists a select group of notable hedge fund managers who were boosting their stakes substantially.
When looking at the hedgies we track, Jeffrey Furber's AEW Capital Management had the biggest position in HCP, Inc. (NYSE:HCP), worth close to $189 million, comprising 5% of its total 13F portfolio. Coming in second is Visium Asset Management, managed by Jacob Gottlieb, which held a $54 million position; 1.9% of its 13F portfolio is allocated to the stock. Some other peers that hold long positions include Jim Simons's Renaissance Technologies, D. E. Shaw's D E Shaw and Phill Gross and Robert Atchinson's Adage Capital Management.
Consequently, key money managers were breaking ground themselves. Visium Asset Management, managed by Jacob Gottlieb, established the most valuable position in HCP, Inc. (NYSE:HCP). Visium Asset Management had 54 million invested in the company at the end of the quarter. Jim Simons's Renaissance Technologies also made a $37 million investment in the stock during the quarter. The other funds with brand new HCP positions are Leighton Welch's Welch Capital Partners, Richard Driehaus's Driehaus Capital, and Daniel S. Och's OZ Management.
Bullish insider trading is best served when the company in question has seen transactions within the past 180 days. Over the latest 180-day time frame, HCP, Inc. (NYSE:HCP) has experienced zero unique insiders purchasing, and 11 insider sales (see the details of insider trades here).
With the returns shown by our studies, everyday investors must always monitor hedge fund and insider trading sentiment, and HCP, Inc. (NYSE:HCP) is no exception.
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.