Is Travelers Companies Inc (NYSE:TRV) a buy?
In today’s marketplace, there are plenty of indicators investors can use to track the equity markets. A pair of the most useful are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top fund managers can trounce the market by a solid margin (see just how much).
Equally as useful, positive insider trading sentiment is a second way to look at the world of equities. There are many motivations for an insider to sell shares of his or her company, but only one, very clear reason why they would behave bullishly. Various academic studies have demonstrated the market-beating potential of this strategy if you understand what to do (learn more here).
Thus, it's important to discuss the newest info surrounding Travelers Companies Inc (NYSE:TRV).
Heading into Q3, a total of 29 of the hedge funds we track were long in this stock, a change of 0% from the previous quarter. With hedgies' sentiment swirling, there exists a few key hedge fund managers who were increasing their holdings substantially.
Out of the funds we follow, Mason Hawkins's Southeastern Asset Management had the most valuable position in Travelers Companies Inc (NYSE:TRV), worth close to $1.1439 billion, accounting for 5.6% of its total 13F portfolio. Sitting at the No. 2 spot is AQR Capital Management, managed by Cliff Asness, which held a $117.3 million position; 0.4% of its 13F portfolio is allocated to the company. Other peers that are bullish include Jim Simons's Renaissance Technologies, Israel Englander's Millennium Management and Ken Griffin's Citadel Investment Group.
Due to the fact Travelers Companies Inc (NYSE:TRV) has experienced declining interest from upper-tier hedge fund managers, it's safe to say that there was a specific group of money managers that elected to cut their full holdings heading into Q2. At the top of the heap, Robert Rodriguez and Steven Romick's First Pacific Advisors LLC dropped the largest stake of the 450+ funds we track, comprising about $61.2 million in stock. Andrew Sandler's fund, Sandler Capital Management, also said goodbye to its stock, about $25.1 million worth. These transactions are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Insider buying is particularly usable when the primary stock in question has seen transactions within the past six months. Over the latest six-month time frame, Travelers Companies Inc (NYSE:TRV) has seen zero unique insiders purchasing, and 11 insider sales (see the details of insider trades here).
We'll go over the relationship between both of these indicators in other stocks similar to Travelers Companies Inc (NYSE:TRV). These stocks are Loews Corporation (NYSE:L), American International Group Inc (NYSE:AIG), The Chubb Corporation (NYSE:CB), The Allstate Corporation (NYSE:ALL), and ACE Limited (NYSE:ACE). This group of stocks belong to the property & casualty insurance industry and their market caps match TRV's market cap.