Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR) shareholders have witnessed an increase in support from the world’s most elite money managers in recent months.
To most market participants, hedge funds are assumed to be slow, old financial vehicles of the past. While there are greater than 8000 funds in operation at present, we choose to focus on the aristocrats of this group, around 450 funds. It is widely believed that this group oversees the lion’s share of all hedge funds’ total asset base, and by monitoring their highest performing equity investments, we have determined a few investment strategies that have historically outpaced the S&P 500 index. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).
Equally as important, positive insider trading sentiment is a second way to parse down the world of equities. As the old adage goes: there are a number of incentives for an upper level exec to sell shares of his or her company, but only one, very simple reason why they would initiate a purchase. Plenty of academic studies have demonstrated the valuable potential of this method if piggybackers know where to look (learn more here).
With all of this in mind, let’s take a look at the latest action surrounding Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR).
How have hedgies been trading Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR)?
Heading into 2013, a total of 9 of the hedge funds we track held long positions in this stock, a change of 29% from the third quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings meaningfully.
Of the funds we track, SAC Capital Advisors, managed by Steven Cohen, holds the biggest position in Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR). SAC Capital Advisors has a $14 million position in the stock, comprising 0.1% of its 13F portfolio. The second largest stake is held by D E Shaw, managed by D. E. Shaw, which held a $6 million position; 0.1% of its 13F portfolio is allocated to the company. Other peers that hold long positions include Jerome Pfund and Michael Sjostrom’s Sectoral Asset Management, Ken Griffin’s Citadel Investment Group and Dmitry Balyasny’s Balyasny Asset Management.
As one would reasonably expect, key money managers have been driving this bullishness. Balyasny Asset Management, managed by Dmitry Balyasny, initiated the biggest position in Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR). Balyasny Asset Management had 3 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $1 million investment in the stock during the quarter. The other funds with new positions in the stock are Malcolm Fairbairn’s Ascend Capital, Paul Tudor Jones’s Tudor Investment Corp, and Jeffrey Vinik’s Vinik Asset Management.
What have insiders been doing with Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR)?
Insider purchases made by high-level executives is at its handiest when the primary stock in question has seen transactions within the past 180 days. Over the last 180-day time frame, Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR) has experienced 1 unique insiders purchasing, and zero 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 Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR). These stocks are EXACT Sciences Corporation (NASDAQ:EXAS), ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD), Merrimack Pharmaceuticals Inc (NASDAQ:MACK), Cadence Pharmaceuticals, Inc. (NASDAQ:CADX), and Array Biopharma Inc (NASDAQ:ARRY). This group of stocks are the members of the biotechnology industry and their market caps resemble OPTR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| EXACT Sciences Corporation (NASDAQ:EXAS) | 11 | 2 | 0 |
| ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) | 12 | 0 | 2 |
| Merrimack Pharmaceuticals Inc (NASDAQ:MACK) | 7 | 3 | 1 |
| Cadence Pharmaceuticals, Inc. (NASDAQ:CADX) | 3 | 0 | 1 |
| Array Biopharma Inc (NASDAQ:ARRY) | 15 | 0 | 1 |
With the results exhibited by Insider Monkey’s studies, retail investors must always watch hedge fund and insider trading sentiment, and Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR) shareholders fit into this picture quite nicely.
