Raymond James Financial, Inc. (NYSE:RJF) investors should be aware of a decrease in enthusiasm from smart money recently.
According to most stock holders, hedge funds are seen as underperforming, outdated financial tools of the past. While there are over 8000 funds in operation at the moment, we at Insider Monkey hone in on the upper echelon of this club, close to 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 monitoring their best stock picks, we have spotted a number of investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per 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 (explore the details and some picks here).
Equally as important, positive insider trading activity is another way to break down the financial markets. Just as you’d expect, there are a number of reasons for an executive to get rid of shares of his or her company, but just one, very simple reason why they would initiate a purchase. Various academic studies have demonstrated the impressive potential of this method if “monkeys” understand where to look (learn more here).
With all of this in mind, let’s take a look at the key action surrounding Raymond James Financial, Inc. (NYSE:RJF).
How are hedge funds trading Raymond James Financial, Inc. (NYSE:RJF)?
At year’s end, a total of 18 of the hedge funds we track held long positions in this stock, a change of -18% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their stakes considerably.
Of the funds we track, Citadel Investment Group, managed by Ken Griffin, holds the most valuable position in Raymond James Financial, Inc. (NYSE:RJF). Citadel Investment Group has a $86 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Ken Fisher of Fisher Asset Management, with a $58 million position; 0.2% of its 13F portfolio is allocated to the stock. Remaining hedge funds that hold long positions include Chuck Royce’s Royce & Associates, Jim Simons’s Renaissance Technologies and Gregg J. Powers’s Private Capital Management.
Seeing as Raymond James Financial, Inc. (NYSE:RJF) has experienced bearish sentiment from hedge fund managers, logic holds that there lies a certain “tier” of funds that decided to sell off their entire stakes last quarter. At the top of the heap, Neil Chriss’s Hutchin Hill Capital cut the largest stake of the “upper crust” of funds we key on, worth close to $12 million in stock., and Malcolm Fairbairn of Ascend Capital was right behind this move, as the fund dumped about $4 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest dropped by 4 funds last quarter.
How have insiders been trading Raymond James Financial, Inc. (NYSE:RJF)?
Insider trading activity, especially when it’s bullish, is particularly usable when the primary stock in question has experienced transactions within the past 180 days. Over the latest 180-day time period, Raymond James Financial, Inc. (NYSE:RJF) has seen 2 unique insiders purchasing, and 10 insider sales (see the details of insider trades here).
With the returns exhibited by our strategies, everyday investors should always watch hedge fund and insider trading sentiment, and Raymond James Financial, Inc. (NYSE:RJF) 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.