Children’s Place Retail Stores, Inc. (NASDAQ:PLCE) was in 18 hedge funds’ portfolio at the end of December. PLCE shareholders have witnessed an increase in activity from the world’s largest hedge funds lately. There were 11 hedge funds in our database with PLCE holdings at the end of the previous quarter.
If you’d ask most traders, hedge funds are viewed as unimportant, outdated financial tools of yesteryear. While there are greater than 8000 funds with their doors open at present, we choose to focus on the top tier of this club, about 450 funds. It is estimated that this group controls the lion’s share of all hedge funds’ total asset base, and by watching their highest performing equity investments, we have determined 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 began to sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 25 percentage points in 6.5 month (see all of our picks from August).
Equally as integral, positive insider trading activity is a second way to parse down the stock market universe. Obviously, there are lots of incentives for an executive to get rid of shares of his or her company, but only one, very simple reason why they would buy. Various empirical studies have demonstrated the market-beating potential of this strategy if you understand where to look (learn more here).
Now, let’s take a gander at the recent action surrounding Children’s Place Retail Stores, Inc. (NASDAQ:PLCE).
What have hedge funds been doing with Children’s Place Retail Stores, Inc. (NASDAQ:PLCE)?
Heading into 2013, a total of 18 of the hedge funds we track held long positions in this stock, a change of 64% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their holdings substantially.
Of the funds we track, Adage Capital Management, managed by Phill Gross and Robert Atchinson, holds the largest position in Children’s Place Retail Stores, Inc. (NASDAQ:PLCE). Adage Capital Management has a $97 million position in the stock, comprising 0.4% of its 13F portfolio. Coming in second is Chuck Royce of Royce & Associates, with a $66 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining peers that hold long positions include Cliff Asness’s AQR Capital Management, Israel Englander’s Millennium Management and Steven Cohen’s SAC Capital Advisors.
As one would reasonably expect, key hedge funds were breaking ground themselves. Millennium Management, managed by Israel Englander, created the biggest position in Children’s Place Retail Stores, Inc. (NASDAQ:PLCE). Millennium Management had 12 million invested in the company at the end of the quarter. Steven Cohen’s SAC Capital Advisors also initiated a $9 million position during the quarter. The other funds with new positions in the stock are Glenn Russell Dubin’s Highbridge Capital Management, Joel Greenblatt’s Gotham Asset Management, and Dmitry Balyasny’s Balyasny Asset Management.
What have insiders been doing with Children’s Place Retail Stores, Inc. (NASDAQ:PLCE)?
Insider trading activity, especially when it’s bullish, is particularly usable when the company in focus has experienced transactions within the past half-year. Over the last six-month time frame, Children’s Place Retail Stores, Inc. (NASDAQ:PLCE) has seen 1 unique insiders purchasing, and 4 insider sales (see the details of insider trades here).
With the results shown by Insider Monkey’s time-tested strategies, everyday investors should always keep an eye on hedge fund and insider trading activity, and Children’s Place Retail Stores, Inc. (NASDAQ:PLCE) is an important part of this process.
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