Great Plains Energy Incorporated (NYSE:GXP) has experienced an increase in hedge fund interest lately.
In the eyes of most traders, hedge funds are seen as slow, outdated financial tools of the past. While there are more than 8000 funds with their doors open at the moment, we look at the upper echelon of this club, around 450 funds. It is widely believed that this group controls the majority of all hedge funds’ total capital, and by tracking their highest performing picks, we have brought to light a few investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually 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 trumped the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).
Equally as integral, positive insider trading sentiment is a second way to break down the marketplace. As the old adage goes: there are many motivations for an insider to sell shares of his or her company, but only one, very obvious reason why they would behave bullishly. Several empirical studies have demonstrated the impressive potential of this method if shareholders understand where to look (learn more here).
With these “truths” under our belt, we’re going to take a peek at the key action regarding Great Plains Energy Incorporated (NYSE:GXP).
Hedge fund activity in Great Plains Energy Incorporated (NYSE:GXP)
In preparation for this year, a total of 13 of the hedge funds we track were long in this stock, a change of 44% from one quarter earlier. With the smart money’s capital changing hands, there exists a few notable hedge fund managers who were boosting their holdings meaningfully.
Of the funds we track, Mario Gabelli’s GAMCO Investors had the largest position in Great Plains Energy Incorporated (NYSE:GXP), worth close to $21 million, accounting for 0.2% of its total 13F portfolio. Sitting at the No. 2 spot is Millennium Management, managed by Israel Englander, which held a $14 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other hedgies that are bullish include Ken Gray and Steve Walsh’s Bryn Mawr Capital, John A. Levin’s Levin Capital Strategies and D. E. Shaw’s D E Shaw.
As industrywide interest jumped, key hedge funds were leading the bulls’ herd. Renaissance Technologies, managed by Jim Simons, initiated the biggest position in Great Plains Energy Incorporated (NYSE:GXP). Renaissance Technologies had 3 million invested in the company at the end of the quarter. Glenn Russell Dubin’s Highbridge Capital Management also initiated a $2 million position during the quarter. The other funds with new positions in the stock are David Costen Haley’s HBK Investments, Paul Tudor Jones’s Tudor Investment Corp, and John Overdeck and David Siegel’s Two Sigma Advisors.
Insider trading activity in Great Plains Energy Incorporated (NYSE:GXP)
Insider purchases made by high-level executives is particularly usable when the company in focus has seen transactions within the past 180 days. Over the latest half-year time period, Great Plains Energy Incorporated (NYSE:GXP) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Great Plains Energy Incorporated (NYSE:GXP). These stocks are Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR), Cleco Corporation (NYSE:CNL), Dynegy Inc. (NYSE:DYN), Companhia Paranaense de Energia (ADR) (NYSE:ELP), and TECO Energy, Inc. (NYSE:TE). This group of stocks are the members of the electric utilities industry and their market caps are closest to GXP’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR)||7||0||0|
|Cleco Corporation (NYSE:CNL)||9||0||0|
|Dynegy Inc. (NYSE:DYN)||16||3||1|
|Companhia Paranaense de Energia (ADR) (NYSE:ELP)||6||0||0|
|TECO Energy, Inc. (NYSE:TE)||10||0||4|
With the results shown by the aforementioned tactics, everyday investors should always keep an eye on hedge fund and insider trading sentiment, and Great Plains Energy Incorporated (NYSE:GXP) shareholders fit into this picture quite nicely.