Should You Buy OneBeacon Insurance Group, Ltd. (OB)?

Interestingly, Peter Muller’s PDT Partners said goodbye to the biggest stake of all the hedgies watched by Insider Monkey, worth an estimated $0.4 million in stock. Mike Vranos’s fund, Ellington, also sold off its stock, about $0.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s go over hedge fund activity in other stocks similar to OneBeacon Insurance Group, Ltd. (NYSE:OB). These stocks are Advanced Micro Devices, Inc. (NASDAQ:AMD), Descartes Systems Group (USA) (NASDAQ:DSGX), Sarepta Therapeutics Inc (NASDAQ:SRPT), and Scholastic Corp (NASDAQ:SCHL). This group of stocks’ market valuations are similar to OB’s market valuation.

As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $119 million. That figure was $12 million in OB’s case. Sarepta Therapeutics Inc (NASDAQ:SRPT) is the most popular stock in this table. On the other hand Descartes Systems Group (USA) (NASDAQ:DSGX) is the least popular one with only 4 bullish hedge fund positions. OneBeacon Insurance Group, Ltd. (NYSE:OB) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard SRPT might be a better candidate to consider a long position.