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Is Cooper Tire & Rubber Company (NYSE:CTB) Going to Burn These Hedge Funds?

Is Cooper Tire & Rubber Company (NYSE:CTB) a buy here? Prominent investors are getting more bullish. The number of bullish hedge fund bets improved by 5 recently.

If you’d ask most traders, hedge funds are viewed as slow, old investment tools of years past. While there are greater than 8000 funds trading at present, we hone in on the bigwigs of this club, about 450 funds. It is widely believed that this group has its hands on most of all hedge funds’ total asset base, and by paying attention to their best investments, we have spotted a few investment strategies that have historically beaten the broader indices. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 25 percentage points in 6.5 month (see the details here).

Cooper Tire & Rubber Company (NYSE:CTB)Equally as important, positive insider trading activity is another way to break down the investments you’re interested in. Obviously, there are a variety of stimuli for an insider to cut shares of his or her company, but only one, very clear reason why they would behave bullishly. Several academic studies have demonstrated the impressive potential of this strategy if investors know what to do (learn more here).

Now, it’s important to take a peek at the key action regarding Cooper Tire & Rubber Company (NYSE:CTB).

What have hedge funds been doing with Cooper Tire & Rubber Company (NYSE:CTB)?

Heading into 2013, a total of 20 of the hedge funds we track were long in this stock, a change of 33% from one quarter earlier. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were upping their holdings substantially.

According to our comprehensive database, David Dreman’s Dreman Value Management had the largest position in Cooper Tire & Rubber Company (NYSE:CTB), worth close to $42 million, accounting for 1.2% of its total 13F portfolio. The second largest stake is held by Renaissance Technologies, managed by Jim Simons, which held a $31 million position; 0.3% of its 13F portfolio is allocated to the stock. Other peers with similar optimism include Chuck Royce’s Royce & Associates, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Cliff Asness’s AQR Capital Management.

As aggregate interest increased, some big names have jumped into Cooper Tire & Rubber Company (NYSE:CTB) headfirst. Hutchin Hill Capital, managed by Neil Chriss, established the largest position in Cooper Tire & Rubber Company (NYSE:CTB). Hutchin Hill Capital had 3 million invested in the company at the end of the quarter. Glenn Russell Dubin’s Highbridge Capital Management also initiated a $3 million position during the quarter. The other funds with new positions in the stock are Andy Redleaf’s Whitebox Advisors, D. E. Shaw’s D E Shaw, and Drew Cupps’s Cupps Capital Management.

What do corporate executives and insiders think about Cooper Tire & Rubber Company (NYSE:CTB)?

Insider trading activity, especially when it’s bullish, is at its handiest when the company in focus has seen transactions within the past 180 days. Over the latest half-year time period, Cooper Tire & Rubber Company (NYSE:CTB) has experienced zero unique insiders purchasing, and 2 insider sales (see the details of insider trades here).

With the results shown by the aforementioned time-tested strategies, everyday investors must always keep an eye on hedge fund and insider trading sentiment, and Cooper Tire & Rubber Company (NYSE:CTB) shareholders fit into this picture quite nicely.

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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