Is Torchmark Corporation (NYSE:TMK) an excellent investment now? Hedge funds are becoming more confident. The number of bullish hedge fund positions increased by 5 recently.
If you’d ask most traders, hedge funds are assumed to be underperforming, old investment vehicles of yesteryear. While there are more than 8000 funds in operation today, we at Insider Monkey hone in on the masters of this club, around 450 funds. Most estimates calculate that this group oversees the lion’s share of all hedge funds’ total asset base, and by watching their highest performing investments, we have discovered a number of investment strategies that have historically outperformed Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points annually 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 topped the S&P 500 index by 25 percentage points in 6.5 month (see all of our picks from August).
Just as beneficial, positive insider trading sentiment is another way to parse down the world of equities. As the old adage goes: there are plenty of motivations for an insider to cut shares of his or her company, but just one, very clear reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this tactic if piggybackers understand where to look (learn more here).
Now, it’s important to take a glance at the key action regarding Torchmark Corporation (NYSE:TMK).
How are hedge funds trading Torchmark Corporation (NYSE:TMK)?
In preparation for this year, a total of 20 of the hedge funds we track held long positions in this stock, a change of 33% from the third quarter. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings considerably.
When looking at the hedgies we track, Warren Buffett’s Berkshire Hathaway had the most valuable position in Torchmark Corporation (NYSE:TMK), worth close to $219 million, accounting for 0.3% of its total 13F portfolio. Sitting at the No. 2 spot is Richard S. Pzena of Pzena Investment Management, with a $38 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include David Harding’s Winton Capital Management, Jim Simons’s Renaissance Technologies and Israel Englander’s Millennium Management.
Consequently, specific money managers were leading the bulls’ herd. Adage Capital Management, managed by Phill Gross and Robert Atchinson, created the largest position in Torchmark Corporation (NYSE:TMK). Adage Capital Management had 5 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also made a $4 million investment in the stock during the quarter. The following funds were also among the new TMK investors: David Costen Haley’s HBK Investments, Paul Tudor Jones’s Tudor Investment Corp, and Steven Cohen’s SAC Capital Advisors.
What have insiders been doing with Torchmark Corporation (NYSE:TMK)?
Bullish insider trading is most useful when the company in focus has experienced transactions within the past six months. Over the latest six-month time period, Torchmark Corporation (NYSE:TMK) has seen zero unique insiders buying, and 24 insider sales (see the details of insider trades here).
With the results exhibited by the aforementioned tactics, everyday investors must always monitor hedge fund and insider trading sentiment, and Torchmark Corporation (NYSE:TMK) shareholders fit into this picture quite nicely.
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