People’s United Financial, Inc. (NASDAQ:PBCT) was in 7 hedge funds’ portfolio at the end of the first quarter of 2013. PBCT investors should be aware of a decrease in activity from the world’s largest hedge funds recently. There were 14 hedge funds in our database with PBCT positions at the end of the previous quarter.
According to most market participants, hedge funds are seen as slow, outdated financial tools of years past. While there are greater than 8000 funds with their doors open today, we hone in on the bigwigs of this club, about 450 funds. Most estimates calculate that this group controls the majority of the smart money’s total capital, and by keeping an eye on their best investments, we have figured out a number of investment strategies that have historically outpaced the S&P 500 index. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum 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 topped the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).
Equally as beneficial, bullish insider trading activity is a second way to break down the world of equities. Obviously, there are a variety of incentives for an upper level exec to get rid of shares of his or her company, but only one, very simple reason why they would initiate a purchase. Many empirical studies have demonstrated the useful potential of this method if shareholders understand where to look (learn more here).
Keeping this in mind, it’s important to take a glance at the recent action regarding People’s United Financial, Inc. (NASDAQ:PBCT).
Hedge fund activity in People’s United Financial, Inc. (NASDAQ:PBCT)
Heading into Q2, a total of 7 of the hedge funds we track were bullish in this stock, a change of -50% from one quarter earlier. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their holdings significantly.
Of the funds we track, Phill Gross and Robert Atchinson’s Adage Capital Management had the biggest position in People’s United Financial, Inc. (NASDAQ:PBCT), worth close to $3.9 million, accounting for less than 0.1%% of its total 13F portfolio. Coming in second is John Zaro of Bourgeon Capital, with a $2.3 million position; 1.6% of its 13F portfolio is allocated to the company. Remaining peers with similar optimism include Cliff Asness’s AQR Capital Management, Joel Greenblatt’s Gotham Asset Management and Ken Griffin’s Citadel Investment Group.
Because People’s United Financial, Inc. (NASDAQ:PBCT) has witnessed declining sentiment from hedge fund managers, logic holds that there exists a select few fund managers who were dropping their full holdings at the end of the first quarter. At the top of the heap, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital dumped the biggest stake of the “upper crust” of funds we monitor, worth about $9.9 million in stock., and Michael Price of MFP Investors was right behind this move, as the fund dropped about $3.7 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest dropped by 7 funds at the end of the first quarter.
How are insiders trading People’s United Financial, Inc. (NASDAQ:PBCT)?
Insider buying is at its handiest when the primary stock in question has seen transactions within the past half-year. Over the latest 180-day time frame, People’s United Financial, Inc. (NASDAQ:PBCT) has seen zero unique insiders buying, and 1 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to People’s United Financial, Inc. (NASDAQ:PBCT). These stocks are Investors Bancorp, Inc. (NASDAQ:ISBC), First Niagara Financial Group Inc. (NASDAQ:FNFG), New York Community Bancorp, Inc. (NYSE:NYCB), Ocwen Financial Corporation (NYSE:OCN), and Hudson City Bancorp, Inc. (NASDAQ:HCBK). All of these stocks are in the savings & loans industry and their market caps resemble PBCT’s market cap.