Berkshire Hathaway Inc. (NYSE:BRK.B) was in 66 hedge funds’ portfolio at the end of the fourth quarter of 2012. BRK.B investors should pay attention to an increase in hedge fund interest in recent months. There were 61 hedge funds in our database with BRK.B holdings at the end of the previous quarter.
In the financial world, there are many indicators market participants can use to monitor publicly traded companies. A couple of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite money managers can outclass the broader indices by a very impressive margin (see just how much).
Just as beneficial, positive insider trading activity is a second way to parse down the marketplace. Just as you’d expect, there are a number of reasons for an executive to downsize shares of his or her company, but just one, very clear reason why they would behave bullishly. Plenty of empirical studies have demonstrated the useful potential of this method if shareholders know where to look (learn more here).
With all of this in mind, let’s take a glance at the recent action surrounding Berkshire Hathaway Inc. (NYSE:BRK-B).
Hedge fund activity in Berkshire Hathaway Inc. (NYSE:BRK.B)
At year’s end, a total of 66 of the hedge funds we track were long in this stock, a change of 8% from the previous quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were boosting their stakes considerably.
When looking at the hedgies we track, Bill & Melinda Gates Foundation Trust, managed by Michael Larson, holds the largest position in Berkshire Hathaway Inc. (NYSE:BRK.B). Bill & Melinda Gates Foundation Trust has a $7.8112 billion position in the stock, comprising 46.5% of its 13F portfolio. On Bill & Melinda Gates Foundation Trust’s heels is Boykin Curry of Eagle Capital Management, with a $938.9 million position; the fund has 6.7% of its 13F portfolio invested in the stock. Remaining hedge funds that are bullish include D. E. Shaw’s D E Shaw, Tom Russo’s Gardner Russo & Gardner and Jean-Marie Eveillard’s First Eagle Investment Management.
With a general bullishness amongst the heavyweights, key hedge funds have jumped into Berkshire Hathaway Inc. (NYSE:BRK.B) headfirst. Fir Tree, managed by Jeffrey Tannenbaum, created the largest position in Berkshire Hathaway Inc. (NYSE:BRK.B). Fir Tree had 80.7 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $28.3 million position during the quarter. The other funds with brand new BRK-B positions are Julian Robertson’s Tiger Management, Stephen J. Errico’s Locust Wood Capital Advisers, and Stephen J. Errico’s Locust Wood Capital Advisers.
Insider trading activity in Berkshire Hathaway Inc. (NYSE:BRK.B)
Insider buying is particularly usable when the primary stock in question has seen transactions within the past half-year. Over the latest six-month time frame, Berkshire Hathaway Inc. (NYSE:BRK.B) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Berkshire Hathaway Inc. (NYSE:BRK.B). These stocks are Homeowners Choice Inc (NYSE:HCI), American Safety Insurance Holdings, Ltd. (NYSE:ASI), Universal Insurance Holdings, Inc. (NYSEAMEX:UVE), Hallmark Financial Services, Inc. (NASDAQ:HALL), and Fortegra Financial Corp (NYSE:FRF). This group of stocks belong to the property & casualty insurance industry and their market caps match BRK-B’s market cap.