Should You Avoid rue21, inc. (RUE)?

Page 1 of 2

rue21, inc. (NASDAQ:RUE) investors should be aware of a decrease in support from the world’s most elite money managers lately.

In the eyes of most shareholders, hedge funds are perceived as underperforming, outdated investment vehicles of the past. While there are more than 8000 funds trading at the moment, we at Insider Monkey hone in on the upper echelon of this group, about 450 funds. It is widely believed that this group controls the majority of the hedge fund industry’s total asset base, and by tracking their top investments, we have determined a few investment strategies that have historically outpaced the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually 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 topped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).

Just as important, optimistic insider trading sentiment is another way to parse down the investments you’re interested in. As the old adage goes: there are a variety of motivations for an upper level exec to sell shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the market-beating potential of this tactic if piggybackers know where to look (learn more here).

With these “truths” under our belt, it’s important to take a glance at the latest action encompassing rue21, inc. (NASDAQ:RUE).

How have hedgies been trading rue21, inc. (NASDAQ:RUE)?

At the end of the first quarter, a total of 5 of the hedge funds we track held long positions in this stock, a change of -17% from the first quarter. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes considerably.

TUDOR INVESTMENT CORP

When looking at the hedgies we track, Jim Simons’s Renaissance Technologies had the largest position in rue21, inc. (NASDAQ:RUE), worth close to $2.6 million, comprising less than 0.1%% of its total 13F portfolio. The second largest stake is held by Tudor Investment Corp, managed by Paul Tudor Jones, which held a $0.6 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Joel Greenblatt’s Gotham Asset Management, D. E. Shaw’s D E Shaw and Cliff Asness’s AQR Capital Management.

Because rue21, inc. (NASDAQ:RUE) has experienced falling interest from the smart money, we can see that there was a specific group of hedgies who sold off their entire stakes at the end of the first quarter. It’s worth mentioning that Steven Cohen’s SAC Capital Advisors dumped the biggest investment of all the hedgies we monitor, valued at an estimated $7.1 million in stock.. Matthew Hulsizer’s fund, PEAK6 Capital Management, also dropped its stock, about $0.2 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest fell by 1 funds at the end of the first quarter.

What do corporate executives and insiders think about rue21, inc. (NASDAQ:RUE)?

Insider trading activity, especially when it’s bullish, is at its handiest when the company in focus has seen transactions within the past six months. Over the last six-month time period, rue21, inc. (NASDAQ:RUE) has seen zero unique insiders purchasing, and 5 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to rue21, inc. (NASDAQ:RUE). These stocks are Children’s Place Retail Stores, Inc. (NASDAQ:PLCE), The Jones Group Inc. (NYSE:JNY), Hot Topic, Inc. (NASDAQ:HOTT), Stage Stores Inc (NYSE:SSI), and Cato Corp (NYSE:CATO). This group of stocks are the members of the apparel stores industry and their market caps match RUE’s market cap.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

On the Move: The 10 Fastest Growing Businesses in 2015

Fast Money: The 10 Highest Paying Fast Food Restaurants

Mixing It Up: The 14 Best Music Mashups of 2014

Rito Pls Buff: The 10 Least Played Champions in LoL Season 4

10 Covers of Popular Songs that are Better than the Originals

Must See TV: The 9 Most Anticipated Shows of 2015

The 15 Biggest Box Office Bombs of All Time

10 Things The World Can’t Stand About Americans

Picture Perfect: The 6 Smartphones with the Best Cameras

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

The 10 Best Airline Stocks to Invest In Before They Fly Too High

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!