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Is Gleacher & Company Inc (GLCH) Going to Burn These Hedge Funds?

Gleacher & Company Inc (NASDAQ:GLCH) has experienced a decrease in hedge fund sentiment in recent months.

If you’d ask most stock holders, hedge funds are assumed to be underperforming, outdated financial tools of yesteryear. While there are more than 8000 funds in operation at the moment, we choose to focus on the moguls of this club, about 450 funds. It is widely believed that this group oversees most of all hedge funds’ total capital, and by monitoring their highest performing investments, we have discovered a few investment strategies that have historically outstripped the S&P 500 index. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually 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 trumped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).

RENAISSANCE TECHNOLOGIESEqually as important, bullish insider trading activity is another way to break down the stock market universe. There are lots of incentives for an executive to downsize shares of his or her company, but only one, very obvious reason why they would behave bullishly. Various academic studies have demonstrated the useful potential of this strategy if shareholders understand what to do (learn more here).

With these “truths” under our belt, it’s important to take a gander at the recent action regarding Gleacher & Company Inc (NASDAQ:GLCH).

Hedge fund activity in Gleacher & Company Inc (NASDAQ:GLCH)

Heading into Q2, a total of 5 of the hedge funds we track were bullish in this stock, a change of -29% from the first quarter. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were boosting their holdings substantially.

When looking at the hedgies we track, Sander Gerber’s Hudson Bay Capital Management had the biggest position in Gleacher & Company Inc (NASDAQ:GLCH), worth close to $2.3 million, accounting for 0.1% of its total 13F portfolio. Sitting at the No. 2 spot is Joseph A. Jolson of Harvest Capital Strategies, with a $0.9 million position; 0.1% of its 13F portfolio is allocated to the company. Other hedgies with similar optimism include Ryan Schaper’s Point Lobos Capital, Jim Simons’s Renaissance Technologies and Curtis Schenker and Craig Effron’s Scoggin.

Seeing as Gleacher & Company Inc (NASDAQ:GLCH) has witnessed a declination in interest from the entirety of the hedge funds we track, it’s easy to see that there was a specific group of hedgies that slashed their positions entirely at the end of the first quarter. Interestingly, Chuck Royce’s Royce & Associates sold off the biggest investment of all the hedgies we key on, valued at about $0.2 million in stock.. Ken Griffin’s fund, Citadel Investment Group, also sold off its stock, about $0 million worth. These transactions are important to note, as total hedge fund interest fell by 2 funds at the end of the first quarter.

How are insiders trading Gleacher & Company Inc (NASDAQ:GLCH)?

Insider trading activity, especially when it’s bullish, is best served when the company we’re looking at has experienced transactions within the past six months. Over the last 180-day time period, Gleacher & Company Inc (NASDAQ:GLCH) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

With the results exhibited by our time-tested strategies, everyday investors should always watch hedge fund and insider trading sentiment, and Gleacher & Company Inc (NASDAQ:GLCH) is an important part of this process.

Click here to learn why you should track hedge funds

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