Is Gramercy Capital Corp. (NYSE:GKK) undervalued? Prominent investors are selling. The number of bullish hedge fund positions were cut by 3 in recent months.
According to most shareholders, hedge funds are perceived as unimportant, outdated investment tools of years past. While there are greater than 8000 funds with their doors open at present, we at Insider Monkey hone in on the aristocrats of this group, about 450 funds. It is widely believed that this group has its hands on the majority of the smart money’s total asset base, and by monitoring their best investments, we have figured out a number of investment strategies that have historically beaten the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year 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 23.3 percentage points in 8 months (see all of our picks from August).
Equally as important, bullish insider trading activity is another way to break down the marketplace. Just as you’d expect, there are lots of motivations for an executive to drop 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 tactic if “monkeys” know where to look (learn more here).
Consequently, it’s important to take a peek at the latest action surrounding Gramercy Capital Corp. (NYSE:GKK).
How are hedge funds trading Gramercy Capital Corp. (NYSE:GKK)?
In preparation for this quarter, a total of 7 of the hedge funds we track were long in this stock, a change of -30% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their stakes substantially.
According to our comprehensive database, Renaissance Technologies, managed by Jim Simons, holds the largest position in Gramercy Capital Corp. (NYSE:GKK). Renaissance Technologies has a $2.6 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Matthew Hulsizer of PEAK6 Capital Management, with a $1.1 million call position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining peers that hold long positions include Israel Englander’s Millennium Management, Whitney Tilson’s T2 Partners and D. E. Shaw’s D E Shaw.
Seeing as Gramercy Capital Corp. (NYSE:GKK) has experienced declining sentiment from the aggregate hedge fund industry, we can see that there were a few hedge funds who were dropping their full holdings in Q1. It’s worth mentioning that Cliff Asness’s AQR Capital Management sold off the biggest position of the “upper crust” of funds we track, comprising an estimated $0.1 million in stock., and John Overdeck and David Siegel of Two Sigma Advisors was right behind this move, as the fund sold off about $0.1 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 3 funds in Q1.
Insider trading activity in Gramercy Capital Corp. (NYSE:GKK)
Insider buying is at its handiest when the company in focus has seen transactions within the past six months. Over the last half-year time period, Gramercy Capital Corp. (NYSE:GKK) has experienced 1 unique insiders buying, and zero insider sales (see the details of insider trades here).
With the returns shown by the aforementioned research, retail investors must always keep an eye on hedge fund and insider trading activity, and Gramercy Capital Corp. (NYSE:GKK) is an important part of this process.