Senior Housing Properties Trust (NYSE:SNH) investors should pay attention to a decrease in hedge fund interest of late.
According to most shareholders, hedge funds are viewed as worthless, old financial vehicles of the past. While there are more than 8000 funds trading at present, we at Insider Monkey look at the top tier of this club, around 450 funds. Most estimates calculate that this group has its hands on the majority of the hedge fund industry’s total asset base, and by tracking their top equity investments, we have revealed a few investment strategies that have historically outperformed 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 topped the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).
Equally as integral, optimistic insider trading sentiment is another way to break down the marketplace. There are a number of incentives for an executive to cut shares of his or her company, but just one, very simple reason why they would buy. Several empirical studies have demonstrated the impressive potential of this strategy if investors understand what to do (learn more here).
Now, we’re going to take a look at the key action encompassing Senior Housing Properties Trust (NYSE:SNH).
What have hedge funds been doing with Senior Housing Properties Trust (NYSE:SNH)?
In preparation for this year, a total of 8 of the hedge funds we track were bullish in this stock, a change of -27% from one quarter earlier. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were boosting their stakes considerably.
Of the funds we track, Fisher Asset Management, managed by Ken Fisher, holds the biggest position in Senior Housing Properties Trust (NYSE:SNH). Fisher Asset Management has a $46.2 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Israel Englander of Millennium Management, with a $6.1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other peers that are bullish include Cliff Asness’s AQR Capital Management, David Dreman’s Dreman Value Management and J. Alan Reid, Jr.’s Forward Management.
Because Senior Housing Properties Trust (NYSE:SNH) has faced declining sentiment from the aggregate hedge fund industry, we can see that there were a few hedge funds who sold off their positions entirely last quarter. Interestingly, D. E. Shaw’s D E Shaw dropped the largest stake of the 450+ funds we key on, totaling about $16.5 million in stock., and David Costen Haley of HBK Investments was right behind this move, as the fund dumped about $0.6 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest was cut by 3 funds last quarter.
How have insiders been trading Senior Housing Properties Trust (NYSE:SNH)?
Insider purchases made by high-level executives is most useful when the company in question has experienced transactions within the past 180 days. Over the latest six-month time frame, Senior Housing Properties Trust (NYSE:SNH) has seen zero unique insiders buying, 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 Senior Housing Properties Trust (NYSE:SNH). These stocks are Camden Property Trust (NYSE:CPT), Essex Property Trust Inc (NYSE:ESS), Apartment Investment and Management Co. (NYSE:AIV), Two Harbors Investment Corp (NYSE:TWO), and American Campus Communities, Inc. (NYSE:ACC). This group of stocks are the members of the reit – residential industry and their market caps resemble SNH’s market cap.