Is CSX Corporation (NYSE:CSX) a buy, sell, or hold? The best stock pickers are in an optimistic mood. The number of bullish hedge fund positions inched up by 2 lately.
To most traders, hedge funds are viewed as worthless, old investment vehicles of the past. While there are more than 8000 funds with their doors open today, we at Insider Monkey choose to focus on the top tier of this group, close to 450 funds. It is widely believed that this group has its hands on the majority of the hedge fund industry’s total asset base, and by tracking their highest performing picks, we have deciphered 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 per 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 25 percentage points in 6.5 month (explore the details and some picks here).
Just as integral, optimistic insider trading activity is another way to parse down the investments you’re interested in. Obviously, there are many stimuli for an upper level exec to sell shares of his or her company, but just one, very simple reason why they would behave bullishly. Plenty of empirical studies have demonstrated the valuable potential of this method if piggybackers know what to do (learn more here).
With all of this in mind, let’s take a peek at the key action encompassing CSX Corporation (NYSE:CSX).
What have hedge funds been doing with CSX Corporation (NYSE:CSX)?
Heading into 2013, a total of 34 of the hedge funds we track were bullish in this stock, a change of 6% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of notable hedge fund managers who were upping their stakes meaningfully.
When looking at the hedgies we track, Jim Simons’s Renaissance Technologies had the biggest position in CSX Corporation (NYSE:CSX), worth close to $73 million, comprising 0.2% of its total 13F portfolio. Sitting at the No. 2 spot is Levin Capital Strategies, managed by John A. Levin, which held a $43 million position; the fund has 0.9% of its 13F portfolio invested in the stock. Some other hedgies that are bullish include Daniel Arbess’s Perella Weinberg Partners, Israel Englander’s Millennium Management and D. E. Shaw’s D E Shaw.
Now, key money managers were leading the bulls’ herd. Renaissance Technologies, managed by Jim Simons, initiated the biggest position in CSX Corporation (NYSE:CSX). Renaissance Technologies had 73 million invested in the company at the end of the quarter. John A. Levin’s Levin Capital Strategies also initiated a $43 million position during the quarter. The following funds were also among the new CSX investors: Perella Weinberg Partners, John Fichthorn’s Dialectic Capital Management, and Larry Foley and Paul Farrell’s Bronson Point Partners.
How have insiders been trading CSX Corporation (NYSE:CSX)?
Insider trading activity, especially when it’s bullish, is best served when the company in focus has experienced transactions within the past six months. Over the latest six-month time period, CSX Corporation (NYSE:CSX) has experienced zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
With the returns shown by our tactics, retail investors should always keep an eye on hedge fund and insider trading sentiment, and CSX Corporation (NYSE:CSX) 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.