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This Metric Says You Are Smart to Sell Silver Wheaton Corp. (USA) (NYSE:SLW)

Is Silver Wheaton Corp. (USA) (NYSE:SLW) worth your attention right now? Money managers are getting less optimistic. The number of long hedge fund bets dropped by 5 lately.

Silver Wheaton Corp. (SLW)

To the average investor, there are plenty of indicators shareholders can use to monitor the equity markets. A couple of the best 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 money managers can outperform their index-focused peers by a superb margin (see just how much).

Just as key, positive insider trading sentiment is a second way to break down the stock market universe. Obviously, there are lots of motivations for an executive to sell shares of his or her company, but only one, very simple reason why they would initiate a purchase. Various academic studies have demonstrated the valuable potential of this tactic if investors know what to do (learn more here).

Keeping this in mind, we’re going to take a gander at the latest action surrounding Silver Wheaton Corp. (USA) (NYSE:SLW).

What have hedge funds been doing with Silver Wheaton Corp. (USA) (NYSE:SLW)?

At the end of the fourth quarter, a total of 14 of the hedge funds we track held long positions in this stock, a change of -26% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were boosting their stakes significantly.

Of the funds we track, Renaissance Technologies, managed by Jim Simons, holds the largest position in Silver Wheaton Corp. (USA) (NYSE:SLW). Renaissance Technologies has a $95 million position in the stock, comprising 0.3% of its 13F portfolio. On Renaissance Technologies’s heels is Eric Sprott of Sprott Asset Management, with a $28 million position; 0.9% of its 13F portfolio is allocated to the stock. Other hedgies that are bullish include Ken Griffin’s Citadel Investment Group, Robert B. Gillam’s McKinley Capital Management and Michael Hintze’s CQS Cayman LP.

Because Silver Wheaton Corp. (USA) (NYSE:SLW) has witnessed a declination in interest from the smart money, we can see that there exists a select few money managers who were dropping their entire stakes in Q4. At the top of the heap, Peter J. Eichler Jr.’s Aletheia Research and Management said goodbye to the biggest stake of all the hedgies we watch, worth an estimated $21 million in stock., and Peter Rathjens, Bruce Clarke and John Campbell of Arrowstreet Capital was right behind this move, as the fund dumped about $12 million worth. These transactions are interesting, as total hedge fund interest fell by 5 funds in Q4.

Insider trading activity in Silver Wheaton Corp. (USA) (NYSE:SLW)

Insider trading activity, especially when it’s bullish, is best served when the company in question has experienced transactions within the past 180 days. Over the last 180-day time period, Silver Wheaton Corp. (USA) (NYSE:SLW) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

With the returns demonstrated by our strategies, retail investors must always pay attention to hedge fund and insider trading activity, and Silver Wheaton Corp. (USA) (NYSE:SLW) is no exception.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.

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