Syntroleum Corp (NASDAQ:SYNM) investors should be aware of a decrease in hedge fund interest lately.
In the eyes of most shareholders, hedge funds are viewed as slow, outdated financial vehicles of the past. While there are greater than 8000 funds in operation at present, we look at the masters of this group, about 450 funds. Most estimates calculate that this group controls most of the hedge fund industry’s total capital, and by paying attention to their highest performing picks, we have spotted a number of investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outpaced 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 trumped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Equally as beneficial, bullish insider trading activity is a second way to parse down the world of equities. Obviously, there are a variety of stimuli for a corporate insider to drop shares of his or her company, but just one, very clear reason why they would behave bullishly. Plenty of academic studies have demonstrated the market-beating potential of this tactic if piggybackers understand what to do (learn more here).
Now, it’s important to take a look at the recent action surrounding Syntroleum Corp (NASDAQ:SYNM).
What does the smart money think about Syntroleum Corp (NASDAQ:SYNM)?
Heading into Q2, a total of 4 of the hedge funds we track were long in this stock, a change of 0% from the first quarter.
Since Syntroleum Corp (NASDAQ:SYNM) has witnessed falling interest from the aggregate hedge fund industry, it’s safe to say that there exists a select few fund managers that decided to sell off their entire stakes heading into Q2. Intriguingly, Ken Griffin’s Citadel Investment Group dumped the largest stake of the 450+ funds we watch, worth close to $0 million in stock. These transactions are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
How have insiders been trading Syntroleum Corp (NASDAQ:SYNM)?
Bullish insider trading is at its handiest when the company we’re looking at has seen transactions within the past 180 days. Over the last 180-day time period, Syntroleum Corp (NASDAQ:SYNM) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Syntroleum Corp (NASDAQ:SYNM). These stocks are Crosstex Energy Inc (NASDAQ:XTXI), KiOR Inc (NASDAQ:KIOR), Renewable Energy Group Inc (NASDAQ:REGI), Adams Resources & Energy Inc (NYSEAMEX:AE), and Lehigh Gas Partners (NYSE:LGP). All of these stocks are in the oil & gas refining & marketing industry and their market caps resemble SYNM’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Crosstex Energy Inc (NASDAQ:XTXI)||15||0||1|
|KiOR Inc (NASDAQ:KIOR)||4||1||7|
|Renewable Energy Group Inc (NASDAQ:REGI)||7||1||2|
|Adams Resources & Energy Inc (NYSEAMEX:AE)||2||0|
|Lehigh Gas Partners (NYSE:LGP)||0||0|
With the returns shown by the aforementioned time-tested strategies, everyday investors should always pay attention to hedge fund and insider trading activity, and Syntroleum Corp (NASDAQ:SYNM) shareholders fit into this picture quite nicely.