Mellanox Technologies, Ltd. (NASDAQ:MLNX) was in 21 hedge funds' portfolio at the end of December. MLNX investors should pay attention to a decrease in hedge fund interest lately. There were 24 hedge funds in our database with MLNX positions at the end of the previous quarter.
In the financial world, there are a multitude of metrics shareholders can use to watch publicly traded companies. A duo of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top investment managers can outpace the S&P 500 by a significant margin (see just how much).
Just as beneficial, optimistic insider trading sentiment is a second way to break down the marketplace. Just as you'd expect, there are lots of stimuli for a bullish insider to get rid of shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several academic studies have demonstrated the valuable potential of this strategy if shareholders understand what to do (learn more here).
Now, let's take a gander at the key action regarding Mellanox Technologies, Ltd. (NASDAQ:MLNX).
Heading into 2013, a total of 21 of the hedge funds we track held long positions in this stock, a change of -13% from the third quarter. With the smart money's capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their holdings substantially.
Of the funds we track, Tiger Global Management LLC holds the most valuable position in Mellanox Technologies, Ltd. (NASDAQ:MLNX). Tiger Global Management LLC has a $42 million position in the stock, comprising 0.8% of its 13F portfolio. The second largest stake is held by Donald Chiboucis of Columbus Circle Investors, with a $36 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Some other hedge funds that are bullish include Philippe Laffont's Coatue Management, Richard Driehaus's Driehaus Capital and Jim Simons's Renaissance Technologies.
Because Mellanox Technologies, Ltd. (NASDAQ:MLNX) has experienced falling interest from hedge fund managers, it's safe to say that there lies a certain "tier" of fund managers that decided to sell off their positions entirely in Q4. Interestingly, Daniel Benton's Andor Capital Management sold off the largest position of the 450+ funds we key on, worth close to $51 million in stock., and Robert B. Gillam of McKinley Capital Management was right behind this move, as the fund dropped about $32 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest dropped by 3 funds in Q4.
Bullish insider trading is best served when the company in focus has experienced transactions within the past half-year. Over the latest half-year time frame, Mellanox Technologies, Ltd. (NASDAQ:MLNX) has experienced zero unique insiders buying, and 8 insider sales (see the details of insider trades here).
With the results exhibited by Insider Monkey's time-tested strategies, everyday investors must always pay attention to hedge fund and insider trading sentiment, and Mellanox Technologies, Ltd. (NASDAQ:MLNX) shareholders fit into this picture quite nicely.
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