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Hedge Funds Aren’t Crazy About QLogic Corporation (NASDAQ:QLGC) Anymore

QLogic Corporation (NASDAQ:QLGC) shareholders have witnessed a decrease in hedge fund interest in recent months.

QLogic Corporation (NASDAQ:QLGC)

At the moment, there are a multitude of methods investors can use to track publicly traded companies. Two of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best investment managers can outclass their index-focused peers by a significant margin (see just how much).

Just as important, positive insider trading activity is a second way to break down the world of equities. There are a variety of reasons for an insider to get rid of shares of his or her company, but only one, very clear reason why they would behave bullishly. Plenty of empirical studies have demonstrated the useful potential of this strategy if “monkeys” understand what to do (learn more here).

Now, it’s important to take a gander at the latest action encompassing QLogic Corporation (NASDAQ:QLGC).

How have hedgies been trading QLogic Corporation (NASDAQ:QLGC)?

In preparation for this year, a total of 14 of the hedge funds we track were bullish in this stock, a change of -18% from the previous quarter. With the smart money’s capital changing hands, there exists a few notable hedge fund managers who were increasing their stakes considerably.

When looking at the hedgies we track, Ken Griffin’s Citadel Investment Group had the biggest position in QLogic Corporation (NASDAQ:QLGC), worth close to $28 million, accounting for 0% of its total 13F portfolio. On Citadel Investment Group’s heels is Renaissance Technologies, managed by Jim Simons, which held a $18 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other peers that hold long positions include Cliff Asness’s AQR Capital Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Joel Greenblatt’s Gotham Asset Management.

Because QLogic Corporation (NASDAQ:QLGC) has witnessed bearish sentiment from the entirety of the hedge funds we track, it’s easy to see that there lies a certain “tier” of hedge funds that decided to sell off their full holdings heading into 2013. Interestingly, David Dreman’s Dreman Value Management said goodbye to the biggest position of all the hedgies we key on, valued at close to $22 million in stock.. Paul Singer’s fund, Elliott Management, also cut its call options., about $11 million worth. These transactions are interesting, as aggregate hedge fund interest dropped by 3 funds heading into 2013.

How are insiders trading QLogic Corporation (NASDAQ:QLGC)?

Insider purchases made by high-level executives is particularly usable when the company in question has seen transactions within the past six months. Over the last six-month time frame, QLogic Corporation (NASDAQ:QLGC) has experienced zero unique insiders buying, and 1 insider sales (see the details of insider trades here).

With the results shown by our time-tested strategies, retail investors should always keep an eye on hedge fund and insider trading activity, and QLogic Corporation (NASDAQ:QLGC) applies perfectly to this mantra.

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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