Dillard’s, Inc. (NYSE:DDS) investors should pay attention to an increase in activity from the world’s largest hedge funds lately.
To the average investor, there are plenty of indicators investors can use to watch stocks. A pair of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top hedge fund managers can beat the market by a very impressive amount (see just how much).
Equally as important, optimistic insider trading activity is another way to break down the marketplace. Obviously, there are many reasons for an insider to drop shares of his or her company, but just one, very obvious reason why they would buy. Many empirical studies have demonstrated the impressive potential of this strategy if piggybackers know what to do (learn more here).
With all of this in mind, we’re going to take a look at the latest action regarding Dillard’s, Inc. (NYSE:DDS).
How are hedge funds trading Dillard’s, Inc. (NYSE:DDS)?
In preparation for this year, a total of 19 of the hedge funds we track held long positions in this stock, a change of 12% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes significantly.
Of the funds we track, AQR Capital Management, managed by Cliff Asness, holds the most valuable position in Dillard’s, Inc. (NYSE:DDS). AQR Capital Management has a $63 million position in the stock, comprising 0.3% of its 13F portfolio. The second largest stake is held by Jim Simons of Renaissance Technologies, with a $43 million position; 0% of its 13F portfolio is allocated to the stock. Some other hedgies that are bullish include Ken Griffin’s Citadel Investment Group, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and John Overdeck and David Siegel’s Two Sigma Advisors.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. D E Shaw, managed by D. E. Shaw, created the most outsized call position in Dillard’s, Inc. (NYSE:DDS). D E Shaw had 2 million invested in the company at the end of the quarter. Ray Dalio’s Bridgewater Associates also made a $0 million investment in the stock during the quarter. The other funds with new positions in the stock are Glenn Russell Dubin’s Highbridge Capital Management and Robert B. Gillam’s McKinley Capital Management.
What do corporate executives and insiders think about Dillard’s, Inc. (NYSE:DDS)?
Insider trading activity, especially when it’s bullish, is particularly usable when the company we’re looking at has seen transactions within the past half-year. Over the latest 180-day time period, Dillard’s, Inc. (NYSE:DDS) has experienced 1 unique insiders buying, and 5 insider sales (see the details of insider trades here).
With the results shown by our strategies, retail investors should always keep an eye on hedge fund and insider trading sentiment, and Dillard’s, Inc. (NYSE:DDS) applies perfectly to this mantra.
Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.