GSI Group Inc. (USA) (GSIG): Hedge Funds Aren’t Crazy About It, Insider Sentiment Unchanged

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Should GSI Group Inc. (USA) (NASDAQ:GSIG) investors track the following data?

In the eyes of many traders, hedge funds are seen as bloated, old investment vehicles of a forgotten age. Although there are In excess of 8,000 hedge funds trading currently, this site focuses on the crème de la crème of this club, about 525 funds. Analysts calculate that this group oversees the majority of the hedge fund industry’s total assets, and by keeping an eye on their best picks, we’ve identified a few investment strategies that have historically outpaced the S&P 500. 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 began to sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 33 percentage points in 11 months (see all of our picks from August).

Just as necessary, positive insider trading activity is a second way to look at the investments you’re interested in. Obviously, there are a number of motivations for an upper level exec to downsize shares of his or her company, but only one, very simple reason why they would buy. Several academic studies have demonstrated the valuable potential of this strategy if “monkeys” understand where to look (learn more here).

Furthermore, we’re going to analyze the newest info about GSI Group Inc. (USA) (NASDAQ:GSIG).

What does the smart money think about GSI Group Inc. (USA) (NASDAQ:GSIG)?

At the end of the second quarter, a total of 6 of the hedge funds we track held long positions in this stock, a change of -25% from the first quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were increasing their holdings meaningfully.

GSI Group Inc. (USA) (NASDAQ:GSIG)When using filings from the hedgies we track, Royce & Associates, managed by Chuck Royce, holds the biggest position in GSI Group Inc. (USA) (NASDAQ:GSIG). Royce & Associates has a $11.8 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Jim Simons of Renaissance Technologies, with a $1.4 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other hedge funds with similar optimism include Carl Tiedemann and Michael Tiedemann’s TIG Advisors, D. E. Shaw’s D E Shaw and John Overdeck and David Siegel’s Two Sigma Advisors.

Judging by the fact that GSI Group Inc. (USA) (NASDAQ:GSIG) has witnessed a fall in interest from the entirety of the hedge funds we track, logic holds that there exists a select few hedge funds that elected to cut their full holdings last quarter. Interestingly, Phil Frohlich’s Prescott Group Capital Management dropped the biggest stake of all the hedgies we watch, worth an estimated $4.3 million in stock, and Israel Englander of Millennium Management was right behind this move, as the fund sold off about $0.3 million worth. These moves are intriguing to say the least, as total hedge fund interest fell by 2 funds last quarter.

How have insiders been trading GSI Group Inc. (USA) (NASDAQ:GSIG)?

Bullish insider trading is most useful when the company in question has experienced transactions within the past 180 days. Over the last six-month time frame, GSI Group Inc. (USA) (NASDAQ:GSIG) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also review the relationship between both of these indicators in other stocks similar to GSI Group Inc. (USA) (NASDAQ:GSIG). These stocks are Mitcham Industries, Inc. (NASDAQ:MIND), Rudolph Technologies Inc (NASDAQ:RTEC), Affymetrix, Inc. (NASDAQ:AFFX), Telenav Inc (NASDAQ:TNAV), and Zygo Corporation (NASDAQ:ZIGO). This group of stocks belong to the scientific & technical instruments industry and their market caps are similar to GSIG’s market cap.

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