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Hedge Funds Are Selling Buckeye Partners, L.P. (BPL)

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Buckeye Partners, L.P. (NYSE:BPL) has experienced a decrease in activity from the world’s largest hedge funds of late.

According to most investors, hedge funds are perceived as unimportant, outdated investment tools of years past. While there are greater than 8000 funds trading today, we at Insider Monkey choose to focus on the aristocrats of this group, around 450 funds. Most estimates calculate that this group controls the lion’s share of all hedge funds’ total capital, and by keeping an eye on their highest performing equity investments, we have brought to light a few investment strategies that have historically beaten the market. 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 started sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 23.3 percentage points in 8 months (see the details here).

Equally as key, optimistic insider trading sentiment is a second way to parse down the stock market universe. As the old adage goes: there are plenty of reasons for a bullish insider to drop shares of his or her company, but just one, very obvious reason why they would behave bullishly. Many academic studies have demonstrated the market-beating potential of this tactic if “monkeys” understand what to do (learn more here).

With all of this in mind, it’s important to take a glance at the key action regarding Buckeye Partners, L.P. (NYSE:BPL).

What does the smart money think about Buckeye Partners, L.P. (NYSE:BPL)?

In preparation for this quarter, a total of 7 of the hedge funds we track were bullish in this stock, a change of -13% from the first quarter. With the smart money’s sentiment swirling, there exists a select group of noteworthy hedge fund managers who were boosting their stakes significantly.

Buckeye Partners, L.P. (NYSE:BPL)According to our comprehensive database, Jean-Marie Eveillard’s First Eagle Investment Management had the most valuable position in Buckeye Partners, L.P. (NYSE:BPL), worth close to $18 million, accounting for 0.1% of its total 13F portfolio. The second largest stake is held by Michael Messner of Seminole Capital (Investment Mgmt), with a $3.2 million position; 0.2% of its 13F portfolio is allocated to the company. Other hedgies with similar optimism include Matthew Hulsizer’s PEAK6 Capital Management, and Phil Frohlich’s Prescott Group Capital Management.

Since Buckeye Partners, L.P. (NYSE:BPL) has witnessed falling interest from the entirety of the hedge funds we track, logic holds that there were a few fund managers that decided to sell off their full holdings at the end of the first quarter. At the top of the heap, Jim Simons’s Renaissance Technologies said goodbye to the biggest investment of the “upper crust” of funds we key on, totaling an estimated $6.9 million in stock., and Matthew Hulsizer of PEAK6 Capital Management was right behind this move, as the fund said goodbye to about $1 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 1 funds at the end of the first quarter.

How are insiders trading Buckeye Partners, L.P. (NYSE:BPL)?

Insider trading activity, especially when it’s bullish, is at its handiest when the company we’re looking at has seen transactions within the past half-year. Over the last half-year time period, Buckeye Partners, L.P. (NYSE:BPL) has experienced zero unique insiders purchasing, and 1 insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to Buckeye Partners, L.P. (NYSE:BPL). These stocks are Targa Resources Partners LP (NYSE:NGLS), Cheniere Energy Partners LP (NYSEAMEX:CQP), Sunoco Logistics Partners L.P. (NYSE:SXL), Boardwalk Pipeline Partners, LP (NYSE:BWP), and Western Gas Partners, LP (NYSE:WES). This group of stocks belong to the oil & gas pipelines industry and their market caps match BPL’s market cap.

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