Is Ocwen Financial Corporation (NYSE:OCN) the right investment to pursue these days? Prominent investors are becoming hopeful. The number of bullish hedge fund positions increased by 1 recently.
In today’s marketplace, there are plenty of methods shareholders can use to analyze Mr. Market. A couple of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best money managers can trounce the market by a healthy margin (see just how much).
Equally as beneficial, positive insider trading sentiment is another way to parse down the world of equities. There are many motivations for an executive to drop shares of his or her company, but just one, very clear reason why they would buy. Various empirical studies have demonstrated the useful potential of this method if shareholders know where to look (learn more here).
With all of this in mind, it's important to take a peek at the latest action surrounding Ocwen Financial Corporation (NYSE:OCN).
At year's end, a total of 34 of the hedge funds we track held long positions in this stock, a change of 3% from the third quarter. With hedgies' capital changing hands, there exists an "upper tier" of noteworthy hedge fund managers who were increasing their holdings substantially.
According to our comprehensive database, Pine River Capital Management, managed by Brian Taylor, holds the most valuable position in Ocwen Financial Corporation (NYSE:OCN). Pine River Capital Management has a $135 million position in the stock, comprising 2.6% of its 13F portfolio. Coming in second is Israel Englander of Millennium Management, with a $85 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Other hedgies that hold long positions include Steven Cohen's SAC Capital Advisors, John Murphy's Alydar Capital and Christian Leone's Luxor Capital Group.
With a general bullishness amongst the heavyweights, some big names have jumped into Ocwen Financial Corporation (NYSE:OCN) headfirst. Luxor Capital Group, managed by Christian Leone, established the most valuable position in Ocwen Financial Corporation (NYSE:OCN). Luxor Capital Group had 48 million invested in the company at the end of the quarter. Stanley Druckenmiller's Duquesne Capital also initiated a $15 million position during the quarter. The following funds were also among the new OCN investors: Glenn Russell Dubin's Highbridge Capital Management, Geoffrey Raynor's Q Investments (Specter Holdings), and David Costen Haley's HBK Investments.
Insider trading activity, especially when it's bullish, is most useful when the company we're looking at has experienced transactions within the past six months. Over the last 180-day time period, Ocwen Financial Corporation (NYSE:OCN) has experienced zero unique insiders purchasing, and 4 insider sales (see the details of insider trades here).
With the returns demonstrated by Insider Monkey's strategies, retail investors must always pay attention to hedge fund and insider trading sentiment, and Ocwen Financial Corporation (NYSE:OCN) shareholders fit into this picture quite nicely.
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.