To the average investor, there are a multitude of gauges market participants can use to analyze the equity markets. A duo of the most useful are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite fund managers can outperform the S&P 500 by a superb amount (see just how much).
Just as necessary, positive insider trading activity is a second way to look at the marketplace. As the old adage goes: there are plenty of incentives for an insider to cut shares of his or her company, but only one, very simple reason why they would buy. Various academic studies have demonstrated the useful potential of this method if investors understand where to look (learn more here).
What's more, it's important to examine the newest info about Principal Financial Group Inc (NYSE:PFG).
At the end of the second quarter, a total of 9 of the hedge funds we track were bullish in this stock, a change of 29% 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 boosting their holdings significantly.
When using filings from the hedgies we track, Natixis Global Asset Management's Harris Associates had the largest position in Principal Financial Group Inc (NYSE:PFG), worth close to $362.5 million, accounting for 0.8% of its total 13F portfolio. On Harris Associates's heels is D. E. Shaw of D E Shaw, with a $7.1 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other hedge funds that are bullish include David Harding's Winton Capital Management, James H. Litinsky's JHL Capital Group and Cliff Asness's AQR Capital Management.
As one would understandably expect, specific money managers have jumped into Principal Financial Group Inc (NYSE:PFG) headfirst. D E Shaw, managed by D. E. Shaw, initiated the most valuable position in Principal Financial Group Inc (NYSE:PFG). D E Shaw had 7.1 million invested in the company at the end of the quarter. David Harding's Winton Capital Management also initiated a $6.3 million position during the quarter. The following funds were also among the new PFG investors: James H. Litinsky's JHL Capital Group, Cliff Asness's AQR Capital Management, and Ben Levine, Andrew Manuel and Stefan Renold's LMR Partners.
Insider buying is particularly usable when the company we're looking at has experienced transactions within the past six months. Over the last six-month time frame, Principal Financial Group Inc (NYSE:PFG) has experienced zero unique insiders buying, 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 Principal Financial Group Inc (NYSE:PFG). These stocks are Northern Trust Corporation (NASDAQ:NTRS), Invesco Ltd. (NYSE:IVZ), Affiliated Managers Group, Inc. (NYSE:AMG), Carlyle Group LP (NASDAQ:CG), and Oaktree Capital Group LLC (NYSE:OAK). This group of stocks are the members of the asset management industry and their market caps resemble PFG's market cap.