Now, according to many traders, hedge funds are viewed as overrated, old financial tools of an era lost to time. Although there are over 8,000 hedge funds in operation today, this site looks at the upper echelon of this group, about 525 funds. It is assumed that this group oversees the lion's share of all hedge funds' total assets, and by watching their best investments, we've found a few investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we've started sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 33 percentage points in 11 months (find the details here).
Equally as crucial, bullish insider trading activity is a second way to analyze the investments you're interested in. Obviously, there are many incentives for a corporate insider to get rid of shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the market-beating potential of this strategy if investors understand where to look (learn more here).
What's more, let's analyze the recent info about Manpowergroup Inc (NYSE:MAN).
At the end of the second quarter, a total of 14 of the hedge funds we track were bullish in this stock, a change of -13% from one quarter earlier. With hedgies' positions undergoing their usual ebb and flow, there exists an "upper tier" of key hedge fund managers who were boosting their stakes significantly.
According to our 13F database, Royce & Associates, managed by Chuck Royce, holds the largest position in Manpowergroup Inc (NYSE:MAN). Royce & Associates has a $64.7 million position in the stock, comprising 0.2% of its 13F portfolio. The second largest stake is held by AQR Capital Management, managed by Cliff Asness, which held a $43.7 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining hedge funds that are bullish include Alexander Mitchell's Scopus Asset Management, Matthew Lindenbaum's Basswood Capital and Paul Tudor Jones's Tudor Investment Corp.
As Manpowergroup Inc (NYSE:MAN) has experienced a fall in interest from the entirety of the hedge funds we track, we can see that there was a specific group of hedgies that elected to cut their entire stakes at the end of the second quarter. Interestingly, Robert Rodriguez and Steven Romick's First Pacific Advisors LLC cut the largest investment of the "upper crust" of funds we key on, totaling an estimated $15.5 million in stock, and Richard S. Pzena of Pzena Investment Management was right behind this move, as the fund said goodbye to about $7.1 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest was cut by 2 funds at the end of the second quarter.
Insider buying is best served when the company we're looking at has experienced transactions within the past half-year. Over the latest half-year time period, Manpowergroup Inc (NYSE:MAN) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We'll also review the relationship between both of these indicators in other stocks similar to Manpowergroup Inc (NYSE:MAN). These stocks are On Assignment, Inc. (NYSE:ASGN), Paychex, Inc. (NASDAQ:PAYX), 51job, Inc. (ADR) (NASDAQ:JOBS), Team Health Holdings LLC (NYSE:TMH), and Robert Half International Inc. (NYSE:RHI). This group of stocks are in the staffing & outsourcing services industry and their market caps are similar to MAN's market cap.