Strategic Hotels and Resorts Inc (NYSE:BEE) was in 13 hedge funds’ portfolio at the end of the fourth quarter of 2012. BEE shareholders have witnessed a decrease in hedge fund interest of late. There were 15 hedge funds in our database with BEE holdings at the end of the previous quarter.
If you’d ask most stock holders, hedge funds are assumed to be worthless, old investment vehicles of years past. While there are over 8000 funds with their doors open at present, we at Insider Monkey look at the elite of this club, close to 450 funds. It is widely believed that this group oversees the majority of the smart money’s total asset base, and by paying attention to their highest performing equity investments, we have brought to light a few investment strategies that have historically outperformed the S&P 500 index. Our small-cap hedge fund strategy beat 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 outperformed the S&P 500 index by 25 percentage points in 6.5 month (check out a sample of our picks).
Equally as key, positive insider trading sentiment is another way to parse down the financial markets. There are a number of incentives for an upper level exec to drop shares of his or her company, but just one, very simple reason why they would behave bullishly. Many academic studies have demonstrated the useful potential of this method if shareholders know where to look (learn more here).
With all of this in mind, let’s take a look at the latest action encompassing Strategic Hotels and Resorts Inc (NYSE:BEE).
What have hedge funds been doing with Strategic Hotels and Resorts Inc (NYSE:BEE)?
At the end of the fourth quarter, a total of 13 of the hedge funds we track were long in this stock, a change of -13% from the third quarter. With the smart money’s sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes substantially.
According to our comprehensive database, Doug Silverman’s Senator Investment Group had the biggest position in Strategic Hotels and Resorts Inc (NYSE:BEE), worth close to $20 million, comprising 0.4% of its total 13F portfolio. The second largest stake is held by John Paulson of Paulson & Co, with a $10 million position; 0.4% of its 13F portfolio is allocated to the company. Some other hedgies that are bullish include Steven Cohen’s SAC Capital Advisors, Jim Simons’s Renaissance Technologies and Israel Englander’s Millennium Management.
Because Strategic Hotels and Resorts Inc (NYSE:BEE) has witnessed bearish sentiment from the aggregate hedge fund industry, it’s safe to say that there exists a select few hedge funds who were dropping their entire stakes in Q4. At the top of the heap, Ken Heebner’s Capital Growth Management cut the largest stake of all the hedgies we track, worth close to $16 million in stock., and Drew Cupps of Cupps Capital Management was right behind this move, as the fund sold off about $2 million worth. These moves are important to note, as total hedge fund interest dropped by 2 funds in Q4.
How have insiders been trading Strategic Hotels and Resorts Inc (NYSE:BEE)?
Bullish insider trading is best served when the company in focus has seen transactions within the past half-year. Over the last 180-day time frame, Strategic Hotels and Resorts Inc (NYSE:BEE) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Strategic Hotels and Resorts Inc (NYSE:BEE). These stocks are Chesapeake Lodging Trust (NYSE:CHSP), LaSalle Hotel Properties (NYSE:LHO), Sunstone Hotel Investors Inc (NYSE:SHO), Pebblebrook Hotel Trust (NYSE:PEB), and DiamondRock Hospitality Company (NYSE:DRH). All of these stocks are in the reit – hotel/motel industry and their market caps are similar to BEE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Chesapeake Lodging Trust (NYSE:CHSP) | 6 | 1 | 0 |
| LaSalle Hotel Properties (NYSE:LHO) | 8 | 0 | 1 |
| Sunstone Hotel Investors Inc (NYSE:SHO) | 16 | 0 | 1 |
| Pebblebrook Hotel Trust (NYSE:PEB) | 7 | 0 | 0 |
| DiamondRock Hospitality Company (NYSE:DRH) | 6 | 0 | 0 |
With the returns exhibited by Insider Monkey’s tactics, retail investors should always watch hedge fund and insider trading sentiment, and Strategic Hotels and Resorts Inc (NYSE:BEE) is an important part of this process.
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