CF Industries Holdings, Inc. (NYSE:CF) was in 40 hedge funds’ portfolio at the end of the fourth quarter of 2012. CF shareholders have witnessed a decrease in enthusiasm from smart money lately. There were 48 hedge funds in our database with CF holdings at the end of the previous quarter.
In the 21st century investor’s toolkit, there are dozens of metrics shareholders can use to monitor their holdings. A duo of the most under-the-radar are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best fund managers can outpace their index-focused peers by a superb margin (see just how much).
Just as important, positive insider trading activity is another way to break down the marketplace. There are a number of motivations for an executive to drop shares of his or her company, but only one, very clear reason why they would behave bullishly. Several empirical studies have demonstrated the valuable potential of this method if investors know what to do (learn more here).
Now, let’s take a gander at the recent action encompassing CF Industries Holdings, Inc. (NYSE:CF).
Hedge fund activity in CF Industries Holdings, Inc. (NYSE:CF)
Heading into 2013, a total of 40 of the hedge funds we track were long in this stock, a change of -17% from the previous quarter. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were increasing their stakes substantially.
When looking at the hedgies we track, Jim Simons’s Renaissance Technologies had the largest position in CF Industries Holdings, Inc. (NYSE:CF), worth close to $206.5 million, comprising 0.6% of its total 13F portfolio. On Renaissance Technologies’s heels is Phill Gross and Robert Atchinson of Adage Capital Management, with a $202.7 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Remaining peers that hold long positions include Rob Citrone’s Discovery Capital Management, Sean Cullinan’s Point State Capital and Cliff Asness’s AQR Capital Management.
Due to the fact that CF Industries Holdings, Inc. (NYSE:CF) has witnessed a declination in interest from the aggregate hedge fund industry, it’s safe to say that there is a sect of funds that elected to cut their full holdings heading into 2013. At the top of the heap, John Armitage’s Egerton Capital Limited dropped the biggest investment of the 450+ funds we track, totaling about $130.2 million in stock., and Anand Parekh of Alyeska Investment Group was right behind this move, as the fund said goodbye to about $31.3 million worth. These transactions are interesting, as total hedge fund interest fell by 8 funds heading into 2013.
Insider trading activity in CF Industries Holdings, Inc. (NYSE:CF)
Insider buying is at its handiest when the company in focus has experienced transactions within the past half-year. Over the latest 180-day time period, CF Industries Holdings, Inc. (NYSE:CF) has seen zero unique insiders purchasing, and 3 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to CF Industries Holdings, Inc. (NYSE:CF). These stocks are Syngenta AG (ADR) (NYSE:SYT), Terra Nitrogen Company, L.P. (NYSE:TNH), Potash Corp./Saskatchewan (USA) (NYSE:POT), Mosaic Co (NYSE:MOS), and Agrium Inc. (USA) (NYSE:AGU). This group of stocks belong to the agricultural chemicals industry and their market caps resemble CF’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Syngenta AG (ADR) (NYSE:SYT)||10||0||0|
|Terra Nitrogen Company, L.P. (NYSE:TNH)||2||0||0|
|Potash Corp./Saskatchewan (USA) (NYSE:POT)||25||0||0|
|Mosaic Co (NYSE:MOS)||35||2||0|
|Agrium Inc. (USA) (NYSE:AGU)||22||0||0|
With the returns shown by the aforementioned research, everyday investors must always keep an eye on hedge fund and insider trading activity, and CF Industries Holdings, Inc. (NYSE:CF) is an important part of this process.
See CF’s 7 biggest bulls on the following few pages: