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Hedge Funds Are Selling Validus Holdings, Ltd. (NYSE:VR)

Validus Holdings, Ltd. (NYSE:VR) investors should be aware of a decrease in support from the world’s most elite money managers in recent months.

Validus Holdings, Ltd. (NYSE:VR)

In today’s marketplace, there are dozens of gauges shareholders can use to analyze Mr. Market. A duo of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best fund managers can beat their index-focused peers by a solid margin (see just how much).

Just as key, optimistic insider trading sentiment is a second way to break down the financial markets. There are lots of reasons for an executive to drop shares of his or her company, but just one, very clear reason why they would initiate a purchase. Various empirical studies have demonstrated the valuable potential of this method if “monkeys” know where to look (learn more here).

Now, it’s important to take a glance at the latest action encompassing Validus Holdings, Ltd. (NYSE:VR).

How have hedgies been trading Validus Holdings, Ltd. (NYSE:VR)?

At the end of the fourth quarter, a total of 19 of the hedge funds we track were bullish in this stock, a change of -17% from the third quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their holdings meaningfully.

When looking at the hedgies we track, Ken Griffin’s Citadel Investment Group had the biggest position in Validus Holdings, Ltd. (NYSE:VR), worth close to $56 million, comprising 0.1% of its total 13F portfolio. The second largest stake is held by Adage Capital Management, managed by Phill Gross and Robert Atchinson, which held a $37 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other peers that hold long positions include Leon Cooperman’s Omega Advisors, Robert Pitts’s Steadfast Capital Management and Chuck Royce’s Royce & Associates.

Because Validus Holdings, Ltd. (NYSE:VR) has faced falling interest from hedge fund managers, it’s easy to see that there exists a select few hedgies who were dropping their positions entirely at the end of the year. Intriguingly, Cliff Asness’s AQR Capital Management dumped the largest position of the 450+ funds we watch, worth an estimated $6 million in stock.. Brian Taylor’s fund, Pine River Capital Management, also dumped its stock, about $4 million worth. These transactions are interesting, as total hedge fund interest dropped by 4 funds at the end of the year.

What do corporate executives and insiders think about Validus Holdings, Ltd. (NYSE:VR)?

Bullish insider trading is at its handiest when the company in question has experienced transactions within the past half-year. Over the latest six-month time frame, Validus Holdings, Ltd. (NYSE:VR) has seen 2 unique insiders buying, and 1 insider sales (see the details of insider trades here).

With the results exhibited by our strategies, retail investors must always monitor hedge fund and insider trading activity, and Validus Holdings, Ltd. (NYSE:VR) is no exception.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

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.

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