Newmont Mining Corp (NYSE:NEM) was in 42 hedge funds' portfolio at the end of the fourth quarter of 2012. NEM shareholders have witnessed a decrease in support from the world's most elite money managers of late. There were 46 hedge funds in our database with NEM holdings at the end of the previous quarter.
According to most market participants, hedge funds are perceived as slow, old investment vehicles of years past. While there are over 8000 funds in operation at present, we look at the top tier of this club, around 450 funds. Most estimates calculate that this group oversees the lion's share of the hedge fund industry's total asset base, and by keeping an eye on their top stock picks, we have figured out a few investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per 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 beaten the S&P 500 index by 25 percentage points in 6.5 month (see the details here).
Just as beneficial, positive insider trading sentiment is a second way to parse down the stock market universe. There are many 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 behave bullishly. Many academic studies have demonstrated the impressive potential of this method if shareholders understand where to look (learn more here).
With all of this in mind, let's take a gander at the latest action surrounding Newmont Mining Corp (NYSE:NEM).
At year's end, a total of 42 of the hedge funds we track were long in this stock, a change of -9% from the previous quarter. With the smart money's sentiment swirling, there exists a select group of notable hedge fund managers who were upping their stakes significantly.
According to our comprehensive database, First Eagle Investment Management, managed by Jean-Marie Eveillard, holds the largest position in Newmont Mining Corp (NYSE:NEM). First Eagle Investment Management has a $293 million billion position in the stock, comprising 1% of its 13F portfolio. Coming in second is Mario Gabelli of GAMCO Investors, with a $81 million position; 2.8% of its 13F portfolio is allocated to the company.
Seeing as Newmont Mining Corp (NYSE:NEM) has faced a declination in interest from hedge fund managers, logic holds that there lies a certain "tier" of money managers that elected to cut their entire stakes in Q4. It's worth mentioning that Sean Cullinan's Point State Capital dumped the biggest investment of the 450+ funds we key on, worth an estimated $52 million in stock.. Robert Emil Zoellner's fund, Alpine Associates, also sold off its stock, about $42 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 4 funds in Q4.
Bullish insider trading is particularly usable when the company in focus has seen transactions within the past six months. Over the latest 180-day time frame, Newmont Mining Corp (NYSE:NEM) has experienced zero unique insiders purchasing, and 10 insider sales (see the details of insider trades here).
With the returns demonstrated by the aforementioned research, retail investors should always watch hedge fund and insider trading sentiment, and Newmont Mining Corp (NYSE:NEM) applies perfectly to this mantra.
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