Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) has experienced an increase in enthusiasm from smart money in recent months.
In the 21st century investor’s toolkit, there are many indicators shareholders can use to watch the equity markets. Two of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best hedge fund managers can outclass the broader indices by a healthy amount (see just how much).
Just as integral, bullish insider trading activity is another way to parse down the marketplace. As the old adage goes: there are lots of stimuli for an upper level exec to drop shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several academic studies have demonstrated the market-beating potential of this method if "monkeys" understand what to do (learn more here).
With all of this in mind, let's take a glance at the latest action surrounding Vanda Pharmaceuticals Inc. (NASDAQ:VNDA).
Heading into Q2, a total of 9 of the hedge funds we track were long in this stock, a change of 50% from the previous quarter.
Now, key money managers were leading the bulls' herd. Highland Capital Management, managed by James Dondero, assembled the most outsized position in Vanda Pharmaceuticals Inc. (NASDAQ:VNDA). Highland Capital Management had 0.5 million invested in the company at the end of the quarter. Jim Simons's Renaissance Technologies also initiated a $0.2 million position during the quarter. The only other fund with a new position in the stock is Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk's GRT Capital Partners.
Insider buying is at its handiest when the company in focus has seen transactions within the past six months. Over the last half-year time frame, Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
With the returns shown by the aforementioned strategies, everyday investors must always keep an eye on hedge fund and insider trading activity, and Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) shareholders fit into this picture quite nicely.