Should You Buy Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL)?

Is Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL) the right investment to pursue these days? Hedge funds are becoming more confident. The number of long hedge fund bets went up by 1 recently.

Melco Crown Entertainment (MPEL), Brian Kelly Asian Century Quest

If you’d ask most traders, hedge funds are assumed to be underperforming, outdated financial vehicles of the past. While there are more than 8000 funds with their doors open at the moment, we look at the upper echelon of this group, around 450 funds. Most estimates calculate that this group has its hands on the majority of the smart money’s total capital, and by keeping an eye on their top stock picks, we have uncovered a few investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum 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 trumped the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).

Equally as key, optimistic insider trading sentiment is a second way to break down the marketplace. There are a variety of incentives for an executive to drop shares of his or her company, but just one, very obvious reason why they would buy. Several academic studies have demonstrated the impressive potential of this strategy if you understand where to look (learn more here).

Now, let’s take a peek at the latest action surrounding Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL).

How have hedgies been trading Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL)?

At year’s end, a total of 37 of the hedge funds we track were long in this stock, a change of 3% from the third quarter. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes meaningfully.

When looking at the hedgies we track, OZ Management, managed by Daniel S. Och, holds the biggest position in Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL). OZ Management has a $155 million position in the stock, comprising 0.6% of its 13F portfolio. On OZ Management’s heels is Luxor Capital Group, managed by Christian Leone, which held a $142 million position; the fund has 5% of its 13F portfolio invested in the stock. Some other hedgies that are bullish include J Kevin Kenny Jr’s Emerging Sovereign Group, Brian Kelly’s Asian Century Quest and Rob Citrone’s Discovery Capital Management.

As industrywide interest jumped, key money managers have jumped into Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL) headfirst. Emerging Sovereign Group, managed by J Kevin Kenny Jr, created the biggest position in Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL). Emerging Sovereign Group had 74 million invested in the company at the end of the quarter. John Thaler’s JAT Capital Management also made a $37 million investment in the stock during the quarter. The following funds were also among the new MPEL investors: Jim Simons’s Renaissance Technologies, Donald Chiboucis’s Columbus Circle Investors, and Malcolm Fairbairn’s Ascend Capital.

What do corporate executives and insiders think about Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL)?

Insider trading activity, especially when it’s bullish, is best served when the company in focus has experienced transactions within the past 180 days. Over the latest half-year time period, Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

With the returns exhibited by our strategies, retail investors should always monitor hedge fund and insider trading sentiment, and Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL) shareholders fit into this picture quite nicely.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

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.

Comments
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

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Top 10 Highest Paying Jobs in the World

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!