YOU CAN BEAT HEDGE FUNDSInsider Monkey’s premium newsletter is a unique publication that isolates the hottest stocks among the BEST hedge funds. Our research director Ian Dogan has a Ph.D. in financial economics and is an expert in insider trading. He has managed a $200+ million portfolio within a large hedge fund and now he is utilizing his skills to bring alpha generating investment strategies to Insider Monkey’s premium members. Details on his Small Cap Strategy:
- Our 15 Stock Small Cap Strategy beat the market by 18 percentage points per year between 1999 and 2009.
- We have been sharing the stock picks of this strategy since the end of August in our newsletter. These stocks gained an average of 38.3% between September 4th and April 30th, vs. 15.0% for the S&P 500 index.
- If you had subscribed to our newsletter on day 1 and bought the 15 stocks we recommended you would have already beaten the market by 23.3 percentage points in only 8 months.
- Most billionaire hedge fund managers couldn’t come close to returning 38% in 8 months.
PROFIT FROM BEST HEDGE FUNDS’ BEST STOCK PICKS
Our #1 Pick was United Rentals (URI)United Rentals was our number 1 pick at the end of August. United Rentals is one of those stocks hedge funds had analyzed in detail and they had been extremely bullish about this stock since the end of the first quarter of 2012. It returned 69.8% in 5.5 short months. We shouldn’t tell you this but United Rentals was also our top stock pick in the second issue of our newsletter that was published in the middle of November.
Our #2 Pick was Lennar (LEN)This homebuilder was our number two stock pick. It is up 24.2% in 5.5 months and we recommended the stock when most market commentators were shying away from homebuilders. Hedge funds saw the positive signs coming from this industry and jumped into these stocks before small investors did. Find out if hedge funds are still bullish about Lennar.
Our #3 Pick was Amylin Pharmaceuticals (AMLN)Amylin Pharmaceuticals was acquired by Bristol Myers on August 9th , 2012. Unfortunately it wasn’t possible to imitate this merger arbitrage play by hedge funds. In these situations we recommend investors to increase their investments in the remaining 14 stocks proportionally.
Our #4 Pick was Gen-Probe Incorporated (GPRO)Gen-Probe Incorporated was acquired by Hologic Inc on August 1st , 2012. Unfortunately it wasn’t possible to imitate this merger arbitrage play by hedge funds. This happens quite frequently because merger arbitrage is a very popular hedge fund strategy.
Our #5 Pick was Visteon Corp (VC)Auto parts companies aren’t popular among individual investors but hedge funds knew better.
Our #6 Pick was Hologic Inc (HOLX)Hologic is the third worst performer in our list, yet it outperformed S&P 500’s 9.1% return during the same time period.
Our #7 Pick was W.R. Grace & Co (GRA)W.R. Grace & Co. almost tripled S&P 500’s 9.1% return over the past 5.5 months.
Our #8 Pick was American Eagle Outfitters (AEO)American Eagle Outfitters was our WORST stock pick. It lost only 0.1.% thanks to the huge dividends distributed by the company.
Our #9 Pick was Louisiana Pacific (LPX)Louisiana Pacific is another stock that is too small and unsexy for the financial media to cover. However, hedge funds have been piling on this gem even before its 62.4% return in 5.5 months. We specifically pick stocks that are at least $1 billion in market capitalization, so that there aren’t any issues with stock manipulation. Louisiana Pacific is now an almost $3 billion stock and it was below $2 billion mark when we picked it. Is it too late to buy LPX? Subscribe now to find out.
Our #10 Pick was Owens Corning (OC)Owens Corning also tripled S&P 500’s 9.1% return between September and the middle of February. Owens Corning is also one of the unsexy stocks shunned by retail investors and the media. Hedge funds knew it was undervalued. After a nearly 30% run-up it is still popular among hedge funds.
Our #11 Pick was Ariba Inc (ARBA)Ariba was acquired by SAP on October 1st , 2012. This was also a merger arbitrage play and it returned 0.2% during September. This is the second worst performer among our stock picks. However, small gains are pretty common for these plays. The attractiveness of these investments is their low correlation with the rest of the stock market.
Our #12 Pick was Lear Corporation (LEA)Lear Corporation was the second auto parts company in our list. It managed to outperform the S&P 500 index by nearly 35 percentage points in 5.5 months. It is still very popular among hedge funds despite the huge run-up in its price. Find out if it is still one of our top stock picks.
Our #13 Pick was US Airways (LCC)One of the most talented hedge fund managers we’ve been tracking very closely has been extremely bullish about US Airways when almost all investors were avoiding airlines like the plague. US Airways is the fourth stock in our list that returned more than 35% in 5.5 months. This is an extraordinary performance given that there were only 13 stocks that investors could buy when we published this list.
Our #14 Pick was Corrections Corp of America (CXW)Corrections Corp of America’s beta is less than 1, yet it managed to outperform the S&P 500 index by nearly 7 percentage points in 5.5 months. CXW is our fourth worst performing stock pick.
Our #15 Pick was Walter Energy (WLT)Walter Energy (WLT) returned 16.7% in 5.5 months. It is one of our mediocre stock picks. We shared all of our stock picks with you. Most of our stocks picks outperformed the S&P 500 index and an equal-weighted portfolio of these stocks returned 29.9% between September and the middle of February. S&P 500 index gained only 9.1% during the same time period.
SEE OUR LATEST 15 STOCK PICKS
Click below and sign up today