Is it smart to be bullish on Responsys Inc (NASDAQ:MKTG)?
If you were to ask many traders, hedge funds are seen as overrated, old financial vehicles of an era lost to time. Although there are more than 8,000 hedge funds trading currently, this site looks at the masters of this group, close to 525 funds. Analysts calculate that this group controls the majority of the hedge fund industry’s total assets, and by keeping an eye on their highest performing investments, we’ve formulated a number of investment strategies that have historically outpaced Mr. Market. Our small-cap hedge fund strategy beat 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 outclassed the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).
Just as key, bullish insider trading activity is another way to analyze the world of equities. Just as you’d expect, there are lots of stimuli for an insider to sell shares of his or her company, but just one, very simple reason why they would initiate a purchase. Plenty of academic studies have demonstrated the impressive potential of this strategy if “monkeys” know what to do (learn more here).
Keeping this in mind, let’s analyze the recent info for Responsys Inc (NASDAQ:MKTG).
What have hedge funds been doing with Responsys Inc (NASDAQ:MKTG)?
At Q2’s end, a total of 18 of the hedge funds we track held long positions in this stock, a change of 20% from the previous quarter. With hedge funds’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes substantially.
Out of the hedge funds we follow, Diker Management, managed by Mark N. Diker, holds the biggest position in Responsys Inc (NASDAQ:MKTG). Diker Management has a $28 million position in the stock, comprising 8.7% of its 13F portfolio. On Diker Management’s heels is Seymour Sy Kaufman and Michael Stark of Crosslink Capital, with a $10.9 million position; 0.9% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish include Matthew Knauer and Mina Faltas’s Nokota Management, Eric Semler’s TCS Capital Management and John Wu’s Sureview Capital.
Now, certain bigger names have been driving this bullishness. Diker Management, managed by Mark N. Diker, assembled the biggest position in Responsys Inc (NASDAQ:MKTG). Diker Management had 28 million invested in the company at the end of the quarter. Seymour Sy Kaufman and Michael Stark’s Crosslink Capital also made a $10.9 million investment in the stock during the quarter. The following funds were also among the new MKTG investors: Matthew Knauer and Mina Faltas’s Nokota Management, Eric Semler’s TCS Capital Management, and John Wu’s Sureview Capital.
Insider trading activity in Responsys Inc (NASDAQ:MKTG)
Legal insider trading, particularly when it’s bullish, is most useful when the primary stock in question has experienced transactions within the past six months. Over the last half-year time period, Responsys Inc (NASDAQ:MKTG) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll also take a look at the relationship between both of these indicators in other stocks similar to Responsys Inc (NASDAQ:MKTG). These stocks are SeaChange International (NASDAQ:SEAC), Qualys Inc (NASDAQ:QLYS), LogMeIn Inc (NASDAQ:LOGM), NQ Mobile Inc (ADR) (NYSE:NQ), and Incontact Inc (NASDAQ:SAAS). This group of stocks belong to the application software industry and their market caps match MKTG’s market cap.