Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Is Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM) going to take off soon? Prominent investors are taking a bullish view. The number of long hedge fund bets increased by 5 recently.

At the moment, there are many gauges market participants can use to monitor publicly traded companies. A pair of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best hedge fund managers can outpace the S&P 500 by a very impressive amount (see just how much).

Equally as key, positive insider trading sentiment is another way to parse down the investments you’re interested in. Obviously, there are many incentives for an upper level exec to drop shares of his or her company, but just one, very simple reason why they would buy. Various empirical studies have demonstrated the valuable potential of this method if “monkeys” understand where to look (learn more here).

Keeping this in mind, let’s take a peek at the key action surrounding Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM).

Hedge fund activity in Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM)

At year’s end, a total of 25 of the hedge funds we track were bullish in this stock, a change of 25% from one quarter earlier. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were upping their stakes substantially.

Of the funds we track, Ken Fisher’s Fisher Asset Management had the largest position in Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM), worth close to $567 million, accounting for 1.6% of its total 13F portfolio. Sitting at the No. 2 spot is Renaissance Technologies, managed by Jim Simons, which held a $235 million position; 0% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish include Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Cliff Asness’s AQR Capital Management and Andrew Weiss’s Weiss Asset Management.

Consequently, some big names have been driving this bullishness. D E Shaw, managed by D. E. Shaw, assembled the biggest position in Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM). D E Shaw had 6 million invested in the company at the end of the quarter. Jeffrey Vinik’s Vinik Asset Management also initiated a $4 million position during the quarter. The other funds with brand new TSM positions are Robert B. Gillam’s McKinley Capital Management, Thomas Lenox Kempner’s Davidson Kempner, and Robert Bishop’s Impala Asset Management.

What do corporate executives and insiders think about Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM)?

Bullish insider trading is best served when the primary stock in question has experienced transactions within the past six months. Over the latest half-year time period, Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

With the results demonstrated by our research, retail investors must always keep an eye on hedge fund and insider trading activity, and Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM) shareholders fit into this picture quite nicely.

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