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This Metric Says You Are Smart to Buy Kennedy-Wilson Holdings Inc (KW)

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Is Kennedy-Wilson Holdings Inc (NYSE:KW) a worthy investment now? The smart money is becoming hopeful. The number of long hedge fund positions increased by 7 recently.

If you’d ask most traders, hedge funds are viewed as underperforming, old investment vehicles of yesteryear. While there are more than 8000 funds trading at the moment, we choose to focus on the upper echelon of this club, close to 450 funds. Most estimates calculate that this group controls most of the smart money’s total asset base, and by paying attention to their best stock picks, we have unsheathed a few investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outperformed 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 (explore the details and some picks here).

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Now, it’s important to take a peek at the key action regarding Kennedy-Wilson Holdings Inc (NYSE:KW).

How are hedge funds trading Kennedy-Wilson Holdings Inc (NYSE:KW)?

At the end of the first quarter, a total of 14 of the hedge funds we track held long positions in this stock, a change of 100% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of notable hedge fund managers who were increasing their holdings considerably.

Kennedy-Wilson Holdings Inc (NYSE:KW)According to our comprehensive database, Royce & Associates, managed by Chuck Royce, holds the biggest position in Kennedy-Wilson Holdings Inc (NYSE:KW). Royce & Associates has a $65.8 million position in the stock, comprising 0.2% of its 13F portfolio. The second largest stake is held by Richard S. Meisenberg of ACK Asset Management, with a $10.1 million position; the fund has 4.4% of its 13F portfolio invested in the stock. Other peers that are bullish include Israel Englander’s Millennium Management, Anand Parekh’s Alyeska Investment Group and Prem Watsa’s Fairfax Financial Holdings.

As aggregate interest increased, specific money managers have been driving this bullishness. Alyeska Investment Group, managed by Anand Parekh, created the largest position in Kennedy-Wilson Holdings Inc (NYSE:KW). Alyeska Investment Group had 7.8 million invested in the company at the end of the quarter. Brian Taylor’s Pine River Capital Management also made a $2.7 million investment in the stock during the quarter. The other funds with new positions in the stock are Nick Niell’s Arrowgrass Capital Partners, Cliff Asness’s AQR Capital Management, and Paul Tudor Jones’s Tudor Investment Corp.

What do corporate executives and insiders think about Kennedy-Wilson Holdings Inc (NYSE:KW)?

Bullish insider trading is at its handiest when the primary stock in question has experienced transactions within the past half-year. Over the last 180-day time period, Kennedy-Wilson Holdings Inc (NYSE:KW) has seen 1 unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Kennedy-Wilson Holdings Inc (NYSE:KW). These stocks are Tejon Ranch Company (NYSE:TRC), DuPont Fabros Technology, Inc. (NYSE:DFT), Acadia Realty Trust (NYSE:AKR), Rouse Properties Inc (NYSE:RSE), and FirstService Corporation (USA) (NASDAQ:FSRV). This group of stocks are in the property management industry and their market caps are similar to KW’s market cap.

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