Google Inc (NASDAQ:GOOG) is the most popular stock in the entire top-tier hedge fund industry. For Apple and AIG bulls, this came as quite a surprise, but for anyone betting on the stock getting to the $1,000 club before Priceline and other “competitors,” it’s a welcome fact.
If you’d ask most stock holders, hedge funds are seen as slow, outdated investment tools of yesteryear. While there are more than 8000 funds in operation at the moment, we at Insider Monkey hone in on the upper echelon of this club, about 450 funds. Most estimates calculate that this group controls the majority of all hedge funds’ total capital, and by monitoring their best investments, we have discovered a few investment strategies that have historically outperformed the S&P 500 index. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points a 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 outpaced the S&P 500 index by 33 percentage points in 11 months (see the details here).
Equally as key, bullish insider trading sentiment is a second way to parse down the stock market universe. There are many motivations for an insider to drop shares of his or her company, but only one, very obvious reason why they would buy. Plenty of academic studies have demonstrated the valuable potential of this strategy if piggybackers understand where to look (learn more here).
Keeping this in mind, let’s take a gander at the latest action regarding Google Inc (NASDAQ:GOOG).
What have hedge funds been doing with Google Inc (NASDAQ:GOOG)?
At the end of the second quarter, a total of 159 of the hedge funds we track were long in this stock, a change of 7% from one quarter earlier. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were upping their stakes significantly.
Of the funds we track, Stephen Mandel’s Lone Pine Capital had the largest position in Google Inc (NASDAQ:GOOG), worth close to $829.1 million, comprising 4% of its total 13F portfolio. The second largest stake is held by Paul Ruddock and Steve Heinz of Lansdowne Partners, with a $824.3 million position; the fund has 10.4% of its 13F portfolio invested in the stock. Some other peers that hold long positions include Boykin Curry’s Eagle Capital Management, and Ken Fisher’s Fisher Asset Management.
As industrywide interest jumped, some big names were breaking ground themselves. Lone Pine Capital, managed by Stephen Mandel, created the most outsized position in Google Inc (NASDAQ:GOOG). Lone Pine Capital had 829.1 million invested in the company at the end of the quarter. Paul Ruddock and Steve Heinz’s Lansdowne Partners also made a $824.3 million investment in the stock during the quarter. The other funds with brand new GOOG positions are Boykin Curry‘s Eagle Capital Management, Ken Griffin’s Citadel Investment Group, and Ken Fisher’s Fisher Asset Management.
What have insiders been doing with Google Inc (NASDAQ:GOOG)?
Insider buying is at its handiest when the company we’re looking at has seen transactions within the past half-year. Over the latest six-month time frame, Google Inc (NASDAQ:GOOG) has seen zero unique insiders buying, and 8 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Google Inc (NASDAQ:GOOG). These stocks are Yandex NV (NASDAQ:YNDX), LinkedIn Corp (NYSE:LNKD), Yahoo! Inc. (NASDAQ:YHOO), Baidu.com, Inc. (ADR) (NASDAQ:BIDU), and Facebook Inc (NASDAQ:FB). This group of stocks belong to the internet information providers industry and their market caps are closest to GOOG’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Yandex NV (NASDAQ:YNDX) | 19 | 0 | 0 |
| LinkedIn Corp (NYSE:LNKD) | 45 | 0 | 13 |
| Yahoo! Inc. (NASDAQ:YHOO) | 66 | 0 | 3 |
| Baidu.com, Inc. (ADR) (NASDAQ:BIDU) | 34 | 0 | 0 |
| Facebook Inc (NASDAQ:FB) | 48 | 0 | 9 |
With the results demonstrated by our tactics, everyday investors must always pay attention to hedge fund and insider trading activity, and Google Inc (NASDAQ:GOOG) is an important part of this process.
