Broadcom Corporation (NASDAQ:BRCM) investors should be aware of a decrease in activity from the world’s largest hedge funds in recent months.
In the financial world, there are many indicators shareholders can use to monitor the equity markets. Two of the most under-the-radar are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best money managers can outpace the market by a superb amount (see just how much).
Equally as key, optimistic insider trading sentiment is another way to break down the world of equities. Just as you’d expect, there are many stimuli for a bullish insider to get rid of shares of his or her company, but only one, very simple reason why they would buy. Many academic studies have demonstrated the impressive potential of this tactic if “monkeys” know where to look (learn more here).
With these “truths” under our belt, let’s take a look at the recent action surrounding Broadcom Corporation (NASDAQ:BRCM).
How are hedge funds trading Broadcom Corporation (NASDAQ:BRCM)?
Heading into Q2, a total of 31 of the hedge funds we track were long in this stock, a change of -21% from the previous quarter. With the smart money’s capital changing hands, there exists a few notable hedge fund managers who were upping their stakes meaningfully.
Of the funds we track, Citadel Investment Group, managed by Ken Griffin, holds the biggest position in Broadcom Corporation (NASDAQ:BRCM). Citadel Investment Group has a $244.4 million position in the stock, comprising 0.4% of its 13F portfolio. Sitting at the No. 2 spot is Philippe Laffont of Coatue Management, with a $225.8 million position; the fund has 2.8% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include David Tepper’s Appaloosa Management LP, Jim Simons’s Renaissance Technologies and Steven Cohen’s SAC Capital Advisors.
Due to the fact that Broadcom Corporation (NASDAQ:BRCM) has experienced falling interest from the aggregate hedge fund industry, it’s easy to see that there were a few fund managers who sold off their entire stakes heading into Q2. It’s worth mentioning that Matthew Tewksbury’s Stevens Capital Management said goodbye to the biggest investment of the 450+ funds we key on, totaling an estimated $21.5 million in stock.. Peter Rathjens, Bruce Clarke and John Campbell’s fund, Arrowstreet Capital, also sold off its stock, about $16 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 8 funds heading into Q2.
What have insiders been doing with Broadcom Corporation (NASDAQ:BRCM)?
Bullish insider trading is particularly usable when the primary stock in question has experienced transactions within the past 180 days. Over the latest half-year time period, Broadcom Corporation (NASDAQ:BRCM) has experienced zero unique insiders buying, and 10 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Broadcom Corporation (NASDAQ:BRCM). These stocks are Skyworks Solutions Inc (NASDAQ:SWKS), Taiwan Semiconductor Mfg. Co. Ltd. (ADR) (NYSE:TSM), Marvell Technology Group Ltd. (NASDAQ:MRVL), Xilinx, Inc. (NASDAQ:XLNX), and Analog Devices, Inc. (NASDAQ:ADI). This group of stocks belong to the semiconductor – integrated circuits industry and their market caps resemble BRCM’s market cap.