OMNOVA Solutions Inc. (NYSE:OMN) was in 10 hedge funds’ portfolio at the end of the first quarter of 2013. OMN has experienced a decrease in enthusiasm from smart money recently. There were 13 hedge funds in our database with OMN positions at the end of the previous quarter.
In the eyes of most traders, hedge funds are perceived as underperforming, outdated financial tools of yesteryear. While there are over 8000 funds trading today, we at Insider Monkey hone in on the upper echelon of this group, around 450 funds. It is widely believed that this group has its hands on most of all hedge funds’ total capital, and by paying attention to their best picks, we have uncovered a few investment strategies that have historically outpaced the S&P 500 index. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Just as beneficial, optimistic insider trading activity is a second way to break down the financial markets. Obviously, there are lots of incentives for an upper level exec to cut shares of his or her company, but only one, very simple reason why they would buy. Various empirical studies have demonstrated the valuable potential of this strategy if shareholders understand where to look (learn more here).
Keeping this in mind, we’re going to take a gander at the latest action surrounding OMNOVA Solutions Inc. (NYSE:OMN).
How have hedgies been trading OMNOVA Solutions Inc. (NYSE:OMN)?
In preparation for this quarter, a total of 10 of the hedge funds we track held long positions in this stock, a change of -23% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a select group of notable hedge fund managers who were boosting their stakes significantly.
Of the funds we track, Mario Gabelli’s GAMCO Investors had the most valuable position in OMNOVA Solutions Inc. (NYSE:OMN), worth close to $11.5 million, comprising 0.1% of its total 13F portfolio. The second largest stake is held by Jeffrey Gendell of Tontine Asset Management, with a $3.3 million position; the fund has 0.6% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include Jim Simons’s Renaissance Technologies, Joel Greenblatt’s Gotham Asset Management and Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk’s GRT Capital Partners.
Due to the fact that OMNOVA Solutions Inc. (NYSE:OMN) has experienced a declination in interest from the entirety of the hedge funds we track, we can see that there were a few funds that decided to sell off their full holdings in Q1. At the top of the heap, Alexander Mitchell’s Scopus Asset Management dropped the largest stake of the 450+ funds we watch, worth close to $1.1 million in stock., and Neil Chriss of Hutchin Hill Capital was right behind this move, as the fund dumped about $0.1 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest dropped by 3 funds in Q1.
What do corporate executives and insiders think about OMNOVA Solutions Inc. (NYSE:OMN)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company in question has experienced transactions within the past six months. Over the last half-year time frame, OMNOVA Solutions Inc. (NYSE:OMN) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
With the returns shown by Insider Monkey’s research, everyday investors must always watch hedge fund and insider trading activity, and OMNOVA Solutions Inc. (NYSE:OMN) applies perfectly to this mantra.