Amarin Corporation plc (ADR) (AMRN): The 7 Most Committed Hedgies

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Amarin Corporation plc (ADR) (NASDAQ:AMRN) was in 18 hedge funds’ portfolio at the end of the fourth quarter of 2012. AMRN investors should be aware of a decrease in support from the world’s most elite money managers of late. There were 20 hedge funds in our database with AMRN positions at the end of the previous quarter.

To most shareholders, hedge funds are assumed to be worthless, outdated investment vehicles of the past. While there are greater than 8000 funds in operation at present, we at Insider Monkey look at the upper echelon of this group, about 450 funds. It is estimated that this group oversees the lion’s share of all hedge funds’ total asset base, and by watching their best investments, we have deciphered a few investment strategies that have historically outpaced Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).

Amarin Corporation plc (ADR) (NASDAQ:AMRN)Equally as integral, bullish insider trading activity is another way to parse down the marketplace. Just as you’d expect, there are many motivations for a corporate insider to downsize shares of his or her company, but just one, very clear reason why they would buy. Several academic studies have demonstrated the market-beating potential of this strategy if shareholders understand where to look (learn more here).

With all of this in mind, let’s take a look at the latest action encompassing Amarin Corporation plc (ADR) (NASDAQ:AMRN).

How are hedge funds trading Amarin Corporation plc (ADR) (NASDAQ:AMRN)?

At year’s end, a total of 18 of the hedge funds we track were bullish in this stock, a change of -10% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes significantly.

According to our comprehensive database, Jerome Pfund and Michael Sjostrom’s Sectoral Asset Management had the largest position in Amarin Corporation plc (ADR) (NASDAQ:AMRN), worth close to $20.2 million, comprising 0.7% of its total 13F portfolio. Coming in second is Deerfield Management, managed by James E. Flynn, which held a $19.4 million call position; 1.1% of its 13F portfolio is allocated to the company. Some other peers with similar optimism include Pasco Alfaro / Richard Tumure’s Miura Global Management, Ryan Schaper’s Point Lobos Capital and Mark Kingdon’s Kingdon Capital.

Because Amarin Corporation plc (ADR) (NASDAQ:AMRN) has faced declining sentiment from hedge fund managers, it’s safe to say that there exists a select few hedgies that slashed their positions entirely in Q4. It’s worth mentioning that JΘr⌠me Pfund and Michael Sj÷str÷m’s Sectoral Asset Management dropped the largest stake of the 450+ funds we monitor, totaling an estimated $40.3 million in stock., and Philip Hempleman of Ardsley Partners was right behind this move, as the fund dumped about $21.8 million worth. These moves are interesting, as aggregate hedge fund interest fell by 2 funds in Q4.

Insider trading activity in Amarin Corporation plc (ADR) (NASDAQ:AMRN)

Insider buying is at its handiest when the company in focus has seen transactions within the past 180 days. Over the latest 180-day time period, Amarin Corporation plc (ADR) (NASDAQ:AMRN) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Amarin Corporation plc (ADR) (NASDAQ:AMRN). These stocks are Taro Pharmaceutical Industries Ltd. (NYSE:TARO), Simcere Pharmaceutical Group (ADR) (NYSE:SCR), Orexigen Therapeutics, Inc. (NASDAQ:OREX), The Medicines Company (NASDAQ:MDCO), and ISIS Pharmaceuticals, Inc. (NASDAQ:ISIS). This group of stocks are in the drug manufacturers – other industry and their market caps match AMRN’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Taro Pharmaceutical Industries Ltd. (NYSE:TARO) 4 0 0
Simcere Pharmaceutical Group (ADR) (NYSE:SCR) 1 0 0
Orexigen Therapeutics, Inc. (NASDAQ:OREX) 16 0 1
The Medicines Company (NASDAQ:MDCO) 19 0 8
ISIS Pharmaceuticals, Inc. (NASDAQ:ISIS) 5 0 8

With the returns exhibited by the aforementioned time-tested strategies, everyday investors should always monitor hedge fund and insider trading activity, and Amarin Corporation plc (ADR) (NASDAQ:AMRN) applies perfectly to this mantra.

Check out the 7 most committed hedge fund managers on the following pages. A full list of all hedgies invested in Amarin can be seen here.

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