Gerdau SA (ADR) (NYSE:GGB) investors should be aware of a decrease in support from the world’s most elite money managers of late.
In the 21st century investor’s toolkit, there are plenty of indicators market participants can use to analyze Mr. Market. Some of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best fund managers can outpace the market by a very impressive amount (see just how much).
Just as integral, positive insider trading sentiment is another way to break down the marketplace. Just as you’d expect, there are a number of reasons for an insider to drop shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Several academic studies have demonstrated the useful potential of this strategy if investors know where to look (learn more here).
Consequently, it’s important to take a glance at the latest action encompassing Gerdau SA (ADR) (NYSE:GGB).
How have hedgies been trading Gerdau SA (ADR) (NYSE:GGB)?
Heading into Q2, a total of 10 of the hedge funds we track were long in this stock, a change of -29% from the previous quarter. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their stakes considerably.
Of the funds we track, Renaissance Technologies, managed by Jim Simons, holds the largest position in Gerdau SA (ADR) (NYSE:GGB). Renaissance Technologies has a $30 million position in the stock, comprising 0.1% of its 13F portfolio. The second largest stake is held by Fisher Asset Management, managed by Ken Fisher, which held a $26.8 million position; 0.1% of its 13F portfolio is allocated to the company. Remaining hedge funds with similar optimism include Phill Gross and Robert Atchinson’s Adage Capital Management, Clint Carlson’s Carlson Capital and D. E. Shaw’s D E Shaw.
Since Gerdau SA (ADR) (NYSE:GGB) has witnessed a declination in interest from hedge fund managers, it’s easy to see that there is a sect of funds that decided to sell off their positions entirely heading into Q2. Interestingly, Jason Adler’s AlphaBet Management said goodbye to the largest stake of the 450+ funds we key on, valued at about $4.4 million in stock.. Peter Rathjens, Bruce Clarke and John Campbell’s fund, Arrowstreet Capital, also cut its stock, about $3.4 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 4 funds heading into Q2.
Insider trading activity in Gerdau SA (ADR) (NYSE:GGB)
Insider trading activity, especially when it’s bullish, is most useful when the company we’re looking at has experienced transactions within the past six months. Over the last 180-day time period, Gerdau SA (ADR) (NYSE:GGB) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Gerdau SA (ADR) (NYSE:GGB). These stocks are Companhia Siderurgica Nacional (ADR) (NYSE:SID), POSCO (ADR) (NYSE:PKX), Tenaris S.A. (ADR) (NYSE:TS), ArcelorMittal (ADR) (NYSE:MT), and Nucor Corporation (NYSE:NUE). This group of stocks belong to the steel & iron industry and their market caps are similar to GGB’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Companhia Siderurgica Nacional (ADR) (NYSE:SID) | 10 | 0 | 0 |
| POSCO (ADR) (NYSE:PKX) | 9 | 0 | 0 |
| Tenaris S.A. (ADR) (NYSE:TS) | 10 | 0 | 0 |
| ArcelorMittal (ADR) (NYSE:MT) | 12 | 0 | 0 |
| Nucor Corporation (NYSE:NUE) | 26 | 0 | 1 |
With the returns demonstrated by Insider Monkey’s studies, everyday investors must always pay attention to hedge fund and insider trading activity, and Gerdau SA (ADR) (NYSE:GGB) is no exception.
