ModusLink Global Solutions, Inc. (NASDAQ:MLNK) shareholders have witnessed a decrease in hedge fund interest of late.
If you’d ask most shareholders, hedge funds are viewed as worthless, outdated financial tools of the past. While there are over 8000 funds trading today, we at Insider Monkey look at the bigwigs of this club, close to 450 funds. Most estimates calculate that this group oversees the lion’s share of the smart money’s total capital, and by tracking their best equity investments, we have spotted a few investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per year 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 outpaced the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).
Just as beneficial, bullish insider trading activity is a second way to break down the world of equities. As the old adage goes: there are many reasons for a bullish insider to drop shares of his or her company, but just one, very obvious reason why they would buy. Plenty of academic studies have demonstrated the valuable potential of this method if shareholders know what to do (learn more here).
Keeping this in mind, let’s take a gander at the latest action regarding ModusLink Global Solutions, Inc. (NASDAQ:MLNK).
What have hedge funds been doing with ModusLink Global Solutions, Inc. (NASDAQ:MLNK)?
At the end of the first quarter, a total of 6 of the hedge funds we track were long in this stock, a change of 0% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were increasing their holdings considerably.
Of the funds we track, Warren Lichtenstein’s Steel Partners had the biggest position in ModusLink Global Solutions, Inc. (NASDAQ:MLNK), worth close to $21.4 million, comprising 7.7% of its total 13F portfolio. Coming in second is Renaissance Technologies, managed by Jim Simons, which held a $1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining peers that hold long positions include Mario Gabelli’s GAMCO Investors, John Overdeck and David Siegel’s Two Sigma Advisors and D. E. Shaw’s D E Shaw.
Judging by the fact that ModusLink Global Solutions, Inc. (NASDAQ:MLNK) has experienced falling interest from hedge fund managers, it’s easy to see that there were a few money managers that elected to cut their positions entirely last quarter. Intriguingly, Ken Griffin’s Citadel Investment Group dumped the largest position of all the hedgies we track, valued at an estimated $0.1 million in stock.. Ben Levine Andrew Manuel and Stefan Renold’s fund, LMR Partners, also said goodbye to its stock, about $0 million worth. These bearish behaviors are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Insider trading activity in ModusLink Global Solutions, Inc. (NASDAQ:MLNK)
Bullish insider trading is particularly usable when the primary stock in question has seen transactions within the past half-year. Over the last half-year time period, ModusLink Global Solutions, Inc. (NASDAQ:MLNK) has experienced 1 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to ModusLink Global Solutions, Inc. (NASDAQ:MLNK). These stocks are ClickSoftware Technologies Ltd. (NASDAQ:CKSW), Keynote Systems, Inc. (NASDAQ:KEYN), Innodata Inc (NASDAQ:INOD), Geeknet Inc (NASDAQ:GKNT), and Support.com, Inc. (NASDAQ:SPRT). All of these stocks are in the internet software & services industry and their market caps resemble MLNK’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|ClickSoftware Technologies Ltd. (NASDAQ:CKSW)||6||0||0|
|Keynote Systems, Inc. (NASDAQ:KEYN)||7||0||4|
|Innodata Inc (NASDAQ:INOD)||3||3||0|
|Geeknet Inc (NASDAQ:GKNT)||3||1||1|
|Support.com, Inc. (NASDAQ:SPRT)||11||1||4|
With the returns demonstrated by Insider Monkey’s studies, everyday investors must always pay attention to hedge fund and insider trading sentiment, and ModusLink Global Solutions, Inc. (NASDAQ:MLNK) is no exception.