is ACE Limited (NYSE:ACE) a buy?
Now, according to many of your fellow readers, hedge funds are perceived as overrated, outdated financial tools of an era lost to time. Although there are over 8,000 hedge funds trading in present day, this site looks at the crème de la crème of this group, about 525 funds. Analysts calculate that this group controls the lion’s share of all hedge funds’ total assets, and by keeping an eye on their highest performing picks, we’ve figured out a few investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per 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 beaten the S&P 500 index by 33 percentage points in 11 months (find a sample of our picks).
Keeping this in mind, we’re going to study the latest info surrounding ACE Limited (NYSE:ACE).
How have hedgies been trading ACE Limited (NYSE:ACE)?
Heading into Q3, a total of 24 of the hedge funds we track held long positions in this stock, a change of -23% from one quarter earlier. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were boosting their holdings significantly.
Out of the hedge funds we follow, Adage Capital Management, managed by Phill Gross and Robert Atchinson, holds the most valuable position in ACE Limited (NYSE:ACE). Adage Capital Management has a $100 million position in the stock, comprising 0.3% of its 13F portfolio. Sitting at the No. 2 spot is Clint Carlson of Carlson Capital, with a $70.6 million position; the fund has 0.8% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include Brian Ashford-Russell and Tim Woolley’s Polar Capital, Cliff Asness’s AQR Capital Management and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
Judging by the fact that ACE Limited (NYSE:ACE) has witnessed a fall in interest from the entirety of the hedge funds we track, logic holds that there lies a certain “tier” of funds who were dropping their full holdings heading into Q2. At the top of the heap, Andreas Halvorsen’s Viking Global dropped the largest stake of the “upper crust” of funds we monitor, comprising an estimated $197.7 million in stock, and Russell Hawkins of Hawkins Capital was right behind this move, as the fund cut about $88.8 million worth. These transactions are important to note, as total hedge fund interest fell by 7 funds heading into Q2.
What do corporate executives and insiders think about ACE Limited (NYSE:ACE)?
Legal insider trading, particularly when it’s bullish, is best served when the company we’re looking at has experienced transactions within the past six months. Over the latest 180-day time period, ACE Limited (NYSE:ACE) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We’ll check out the relationship between both of these indicators in other stocks similar to ACE Limited (NYSE:ACE). These stocks are American International Group Inc (NYSE:AIG), Loews Corporation (NYSE:L), The Chubb Corporation (NYSE:CB), The Allstate Corporation (NYSE:ALL), and Travelers Companies Inc (NYSE:TRV). This group of stocks are in the property & casualty insurance industry and their market caps match ACE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| American International Group Inc (NYSE:AIG) | 139 | 0 | 0 |
| Loews Corporation (NYSE:L) | 21 | 0 | 0 |
| The Chubb Corporation (NYSE:CB) | 30 | 0 | 0 |
| The Allstate Corporation (NYSE:ALL) | 35 | 0 | 0 |
| Travelers Companies Inc (NYSE:TRV) | 29 | 0 | 0 |
Using the returns demonstrated by the previously mentioned tactics, regular investors must always keep one eye on hedge fund and insider trading sentiment, and ACE Limited (NYSE:ACE) is an important part of this process.
