Amarin Corporation plc (ADR) (NASDAQ:AMRN) was in 18 hedge funds' portfolio at the end of December. AMRN has experienced a decrease in activity from the world's largest hedge funds lately. There were 20 hedge funds in our database with AMRN holdings at the end of the previous quarter.
According to most shareholders, hedge funds are seen as underperforming, old financial vehicles of the past. While there are over 8000 funds trading today, we choose to focus on the top tier of this group, about 450 funds. It is estimated that this group controls the lion's share of the hedge fund industry's total capital, and by paying attention to their highest performing picks, we have deciphered a number of investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per year 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 beaten the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).
Just as integral, optimistic insider trading sentiment is another way to break down the stock market universe. There are a number of stimuli for an insider to drop shares of his or her company, but only one, very clear reason why they would buy. Various empirical studies have demonstrated the valuable potential of this method if piggybackers understand what to do (learn more here).
Consequently, let's take a look at the latest action encompassing Amarin Corporation plc (ADR) (NASDAQ:AMRN).
At the end of the fourth quarter, a total of 18 of the hedge funds we track were long in this stock, a change of -10% from the previous quarter. With hedgies' positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their holdings meaningfully.
According to our comprehensive database, Jérôme Pfund and Michael Sjöström's Sectoral Asset Management had the most valuable position in Amarin Corporation plc (ADR) (NASDAQ:AMRN), worth close to $20 million, comprising 0.7% of its total 13F portfolio. On Sectoral Asset Management's heels is James E. Flynn of Deerfield Management, with a $19 million call position; the fund has 1.1% of its 13F portfolio invested in the stock. Some other hedge funds that hold long positions include Pasco Alfaro / Richard Tumure's Miura Global Management, Ryan Schaper's Point Lobos Capital and Mark Kingdon's Kingdon Capital.
Judging by the fact that Amarin Corporation plc (ADR) (NASDAQ:AMRN) has faced bearish sentiment from the smart money, it's easy to see that there is a sect of hedgies who were dropping their positions entirely at the end of the year. Interestingly, JΘr⌠me Pfund and Michael Sj÷str÷m's Sectoral Asset Management said goodbye to the largest stake of the "upper crust" of funds we monitor, valued at close to $40 million in stock., and Philip Hempleman of Ardsley Partners was right behind this move, as the fund dropped about $22 million worth. These transactions are intriguing to say the least, as total hedge fund interest fell by 2 funds at the end of the year.
Insider buying is best served when the primary stock in question has experienced transactions within the past six months. Over the latest half-year time frame, Amarin Corporation plc (ADR) (NASDAQ:AMRN) has seen zero unique insiders buying, and 1 insider sales (see the details of insider trades here).
With the results demonstrated by the aforementioned studies, retail investors should always pay attention to hedge fund and insider trading sentiment, and Amarin Corporation plc (ADR) (NASDAQ:AMRN) shareholders fit into this picture quite nicely.
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