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Hedge Funds Are Dumping Cypress Semiconductor Corporation (NASDAQ:CY)

Is Cypress Semiconductor Corporation (NASDAQ:CY) a buy right now? The smart money is in a pessimistic mood. The number of long hedge fund bets went down by 1 recently.

Cypress Semiconductor Corporation (NASDAQ:CY)

According to most traders, hedge funds are viewed as worthless, old investment tools of years past. While there are over 8000 funds with their doors open at the moment, we at Insider Monkey choose to focus on the bigwigs of this club, about 450 funds. Most estimates calculate that this group has its hands on the majority of all hedge funds’ total capital, and by watching their highest performing investments, we have formulated a number of investment strategies that have historically outpaced the broader indices. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per annum 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 beaten the S&P 500 index by 25 percentage points in 6.5 month (check out a sample of our picks).

Just as integral, positive insider trading activity is a second way to break down the world of equities. Just as you’d expect, there are a variety of stimuli for an insider to get rid of shares of his or her company, but just one, very clear reason why they would buy. Various academic studies have demonstrated the market-beating potential of this strategy if investors know where to look (learn more here).

With these “truths” under our belt, let’s take a peek at the latest action surrounding Cypress Semiconductor Corporation (NASDAQ:CY).

How have hedgies been trading Cypress Semiconductor Corporation (NASDAQ:CY)?

In preparation for this year, a total of 16 of the hedge funds we track were bullish in this stock, a change of -6% from the previous quarter. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were increasing their holdings substantially.

According to our comprehensive database, PAR Capital Management, managed by Paul ReederáandáEdward Shapiro, holds the most valuable position in Cypress Semiconductor Corporation (NASDAQ:CY). PAR Capital Management has a $21 million position in the stock, comprising 0.9% of its 13F portfolio. On PAR Capital Management’s heels is AQR Capital Management, managed by Cliff Asness, which held a $8 million position; the fund has 0% of its 13F portfolio invested in the stock. Remaining hedge funds that hold long positions include Israel Englander’s Millennium Management, Mario Gabelli’s GAMCO Investors and D. E. Shaw’s D E Shaw.

Because Cypress Semiconductor Corporation (NASDAQ:CY) has experienced declining sentiment from hedge fund managers, logic holds that there is a sect of fund managers who sold off their entire stakes last quarter. It’s worth mentioning that SAC Subsidiary’s Sigma Capital Management said goodbye to the largest stake of the 450+ funds we track, totaling an estimated $6 million in stock.. Van Schreiber’s fund, Bennett Lawrence Management, also cut its stock, about $3 million worth. These moves are interesting, as aggregate hedge fund interest was cut by 1 funds last quarter.

What have insiders been doing with Cypress Semiconductor Corporation (NASDAQ:CY)?

Insider trading activity, especially when it’s bullish, is most useful when the company we’re looking at has seen transactions within the past half-year. Over the latest 180-day time frame, Cypress Semiconductor Corporation (NASDAQ:CY) has experienced 2 unique insiders buying, and 2 insider sales (see the details of insider trades here).

With the returns exhibited by the aforementioned research, everyday investors must always pay attention to hedge fund and insider trading sentiment, and Cypress Semiconductor Corporation (NASDAQ:CY) is no exception.

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