Anworth Mortgage Asset Corporation (ANH): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do? – iStar Financial Inc. (SFI), Crexus Investment Corp (CXS)

Is Anworth Mortgage Asset Corporation (NYSE:ANH) the right investment to pursue these days? Investors who are in the know are taking a bullish view. The number of long hedge fund positions improved by 3 lately.

At the moment, there are tons of indicators shareholders can use to track publicly traded companies. A duo of the most useful are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite money managers can outperform their index-focused peers by a solid margin (see just how much).

Just as important, positive insider trading activity is another way to parse down the financial markets. As the old adage goes: there are plenty of reasons for an upper level exec to get rid of shares of his or her company, but only one, very clear reason why they would buy. Plenty of empirical studies have demonstrated the useful potential of this strategy if you know where to look (learn more here).

Now, it’s important to take a peek at the recent action regarding Anworth Mortgage Asset Corporation (NYSE:ANH).

iStar Financial Inc.How are hedge funds trading Anworth Mortgage Asset Corporation (NYSE:ANH)?

Heading into 2013, a total of 10 of the hedge funds we track were long in this stock, a change of 43% from the third quarter. With hedgies’ sentiment swirling, there exists a few key hedge fund managers who were boosting their holdings meaningfully.

When looking at the hedgies we track, Pine River Capital Management, managed by Brian Taylor, holds the largest position in Anworth Mortgage Asset Corporation (NYSE:ANH). Pine River Capital Management has a $39.6 million position in the stock, comprising 0.8% of its 13F portfolio. The second largest stake is held by Soros Fund Management, managed by George Soros, which held a $8.5 million position; 0.1% of its 13F portfolio is allocated to the stock. Remaining hedgies with similar optimism include Ken Griffin’s Citadel Investment Group, James Melcher’s Balestra and Jim Simons’s Renaissance Technologies.

With a general bullishness amongst the heavyweights, key hedge funds have been driving this bullishness. Pine River Capital Management, managed by Brian Taylor, initiated the most valuable position in Anworth Mortgage Asset Corporation (NYSE:ANH). Pine River Capital Management had 39.6 million invested in the company at the end of the quarter. George Soros’s Soros Fund Management also made a $8.5 million investment in the stock during the quarter. The following funds were also among the new ANH investors: James Melcher’s Balestra, Jim Simons’s Renaissance Technologies, and Eric Halet and Davide Serra’s Algebris Investments.

Insider trading activity in Anworth Mortgage Asset Corporation (NYSE:ANH)

Insider buying is best served when the primary stock in question has experienced transactions within the past half-year. Over the last six-month time period, Anworth Mortgage Asset Corporation (NYSE:ANH) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).

Let’s also examine hedge fund and insider activity in other stocks similar to Anworth Mortgage Asset Corporation (NYSE:ANH). These stocks are AG Mortgage Investment Trust Inc (NYSE:MITT), Investors Real Estate Trust (NYSE:IRET), Cousins Properties Inc (NYSE:CUZ), Crexus Investment Corp (NYSE:CXS), and iStar Financial Inc. (NYSE:SFI). All of these stocks are in the reit – diversified industry and their market caps resemble ANH’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
AG Mortgage Investment Trust Inc (NYSE:MITT) 11 2 1
Investors Real Estate Trust (NYSE:IRET) 5 7 0
Cousins Properties Inc (NYSE:CUZ) 10 0 2
Crexus Investment Corp (NYSE:CXS) 17 0 0
iStar Financial Inc. (NYSE:SFI) 20 1 2

With the returns demonstrated by Insider Monkey’s strategies, everyday investors should always pay attention to hedge fund and insider trading sentiment, and Anworth Mortgage Asset Corporation (NYSE:ANH) is an important part of this process.

Click here to learn why you should track hedge funds