Is Arlington Asset Investment Corp (AI) A Good Stock To Buy?

Seeing as Arlington Asset Investment Corp (NYSE:AI) has experienced a falling interest from the entirety of the hedge funds we track, it’s safe to say that there is a sect of hedgies that decided to sell off their full holdings by the end of the third quarter. Interestingly, Matthew Hulsizer’s PEAK6 Capital Management dropped the largest investment of all the hedgies followed by Insider Monkey, comprising an estimated $0.3 million in stock. Matthew Tewksbury’s fund, Stevens Capital Management, also cut its stock, about $0.2 million worth of shares. These bearish behaviors are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Arlington Asset Investment Corp (NYSE:AI) but similarly valued. These stocks are Wausau Paper Corp. (NYSE:WPP), Vimicro International Corporation (ADR) (NASDAQ:VIMC), Build-A-Bear Workshop, Inc (NYSE:BBW), and Ecopetrol S.A. (ADR) (NYSE:EC). This group of stocks’ market valuations match Arlington Asset Investment Corp (NYSE:AI)’s market valuation.

As you can see, these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $54 million. That figure was $7 million in Arlington Asset Investment Corp (NYSE:AI)’s case. Wausau Paper Corp. (NYSE:WPP) is the most popular stock in this table. On the other hand, Vimicro International Corporation (ADR) (NASDAQ:VIMC) is the least popular one with only 5 bullish hedge fund positions. Arlington Asset Investment Corp (NYSE:AI) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard, Wausau Paper Corp. (NYSE:WPP) might be a better candidate to consider a long position.