If you were to ask many of your peers, hedge funds are viewed as useless, outdated investment tools of a period lost to current times. Although there are more than 8,000 hedge funds in operation today, this site looks at the leaders of this group, about 525 funds. Analysts calculate that this group controls most of all hedge funds’ total capital, and by paying attention to their highest quality picks, we’ve revealed a number of investment strategies that have historically outpaced the market. Our small-cap hedge fund strategy outpaced 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 outclassed the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).
Just as necessary, bullish insider trading sentiment is a second way to analyze the marketplace. Obviously, there are lots of stimuli for a bullish insider to downsize shares of his or her company, but only one, very clear reason why they would buy. Various academic studies have demonstrated the useful potential of this tactic if piggybackers understand where to look (learn more here).
Now that that’s out of the way, it’s important to study the recent info surrounding PPL Corporation (NYSE:PPL).
How are hedge funds trading PPL Corporation (NYSE:PPL)?
At the end of the second quarter, a total of 24 of the hedge funds we track held long positions in this stock, a change of 4% from one quarter earlier. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were increasing their holdings considerably.
When using filings from the hedgies we track, Millennium Management, managed by Israel Englander, holds the biggest position in PPL Corporation (NYSE:PPL). Millennium Management has a $140.7 million position in the stock, comprising 0.4% of its 13F portfolio. Sitting at the No. 2 spot is Winton Capital Management, managed by David Harding, which held a $41 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include Clint Carlson’s Carlson Capital, Glenn Russell Dubin’s Highbridge Capital Management and Cliff Asness’s AQR Capital Management.
Now, specific money managers have been driving this bullishness. Millennium Management, managed by Israel Englander, established the largest position in PPL Corporation (NYSE:PPL). Millennium Management had 140.7 million invested in the company at the end of the quarter. David Harding’s Winton Capital Management also initiated a $41 million position during the quarter. The other funds with new positions in the stock are Clint Carlson’s Carlson Capital, Glenn Russell Dubin’s Highbridge Capital Management, and Cliff Asness’s AQR Capital Management.
What have insiders been doing with PPL Corporation (NYSE:PPL)?
Legal insider trading, particularly when it’s bullish, is best served when the primary stock in question has experienced transactions within the past six months. Over the latest 180-day time period, PPL Corporation (NYSE:PPL) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll go over the relationship between both of these indicators in other stocks similar to PPL Corporation (NYSE:PPL). These stocks are Edison International (NYSE:EIX), PG&E Corporation (NYSE:PCG), Korea Electric Power Corporation (ADR) (NYSE:KEP), FirstEnergy Corp. (NYSE:FE), and Consolidated Edison, Inc. (NYSE:ED). This group of stocks are the members of the electric utilities industry and their market caps are closest to PPL’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Edison International (NYSE:EIX) | 19 | 0 | 0 |
| PG&E Corporation (NYSE:PCG) | 16 | 0 | 0 |
| Korea Electric Power Corporation (ADR) (NYSE:KEP) | 8 | 0 | 0 |
| FirstEnergy Corp. (NYSE:FE) | 19 | 0 | 0 |
| Consolidated Edison, Inc. (NYSE:ED) | 14 | 0 | 0 |
Using the returns explained by the previously mentioned research, average investors must always watch hedge fund and insider trading activity, and PPL Corporation (NYSE:PPL) shareholders fit into this picture quite nicely.
