Coach, Inc. (NYSE:COH) was in 27 hedge funds’ portfolio at the end of December. COH has experienced a decrease in support from the world’s most elite money managers of late. There were 35 hedge funds in our database with COH holdings at the end of the previous quarter.
To most market participants, hedge funds are viewed as slow, old financial tools of years past. While there are over 8000 funds with their doors open at present, we choose to focus on the upper echelon of this club, about 450 funds. Most estimates calculate that this group has its hands on the lion’s share of all hedge funds’ total asset base, and by tracking their highest performing stock picks, we have identified a number of investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year 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 beaten the S&P 500 index by 25 percentage points in 6.5 month (check out a sample of our picks).
Equally as beneficial, bullish insider trading activity is another way to break down the stock market universe. As the old adage goes: there are a number of motivations for an insider to drop shares of his or her company, but just one, very obvious reason why they would behave bullishly. Various academic studies have demonstrated the useful potential of this method if piggybackers know what to do (learn more here).
Keeping this in mind, it’s important to take a glance at the key action surrounding Coach, Inc. (NYSE:COH).
Hedge fund activity in Coach, Inc. (NYSE:COH)
In preparation for this year, a total of 27 of the hedge funds we track were bullish in this stock, a change of -23% from the third quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their holdings significantly.
When looking at the hedgies we track, Discovery Capital Management, managed by Rob Citrone, holds the biggest position in Coach, Inc. (NYSE:COH). Discovery Capital Management has a $104 million position in the stock, comprising 1.5% of its 13F portfolio. On Discovery Capital Management’s heels is Steven Cohen of SAC Capital Advisors, with a $87 million position; 0.8% of its 13F portfolio is allocated to the company. Some other peers that are bullish include Christopher MedlockáJames’s Partner Fund Management, Robert Joseph Caruso’s Select Equity Group and Jorge Paulo Lemann’s 3G Capital.
Because Coach, Inc. (NYSE:COH) has experienced falling interest from the smart money, it’s easy to see that there were a few hedge funds that decided to sell off their entire stakes last quarter. Interestingly, Jim Simons’s Renaissance Technologies dumped the largest position of the 450+ funds we monitor, valued at close to $45 million in stock.. Steven Cohen’s fund, SAC Capital Advisors, also said goodbye to its call options., about $31 million worth. These moves are interesting, as total hedge fund interest dropped by 8 funds last quarter.
How are insiders trading Coach, Inc. (NYSE:COH)?
Insider trading activity, especially when it’s bullish, is particularly usable when the company we’re looking at has experienced transactions within the past 180 days. Over the latest half-year time period, Coach, Inc. (NYSE:COH) has experienced zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
With the results demonstrated by our strategies, retail investors should always monitor hedge fund and insider trading activity, and Coach, Inc. (NYSE:COH) is an important part of this process.
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.