Hedge Funds Aren’t Crazy About The Spectranetics Corporation (NASDAQ:SPNC) Anymore

Is The Spectranetics Corporation (NASDAQ:SPNC) ready to raly soon? Prominent investors are in a bearish mood. The number of long hedge fund bets were trimmed by 1 in recent months.

To most traders, hedge funds are perceived as slow, outdated financial tools of the past. While there are over 8000 funds with their doors open at the moment, we hone in on the leaders of this club, close to 450 funds. It is widely believed that this group oversees the majority of the hedge fund industry’s total capital, and by keeping an eye on their top stock picks, we have unearthed a few investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started 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 (see all of our picks from August).

The Spectranetics Corporation (NASDAQ:SPNC)

Equally as integral, optimistic insider trading sentiment is a second way to parse down the financial markets. Obviously, there are many stimuli for a bullish insider to drop shares of his or her company, but just one, very simple reason why they would initiate a purchase. Various empirical studies have demonstrated the market-beating potential of this strategy if you know where to look (learn more here).

With these “truths” under our belt, we’re going to take a look at the latest action encompassing The Spectranetics Corporation (NASDAQ:SPNC).

How are hedge funds trading The Spectranetics Corporation (NASDAQ:SPNC)?

Heading into 2013, a total of 12 of the hedge funds we track were long in this stock, a change of -8% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were increasing their holdings significantly.

When looking at the hedgies we track, Richard Driehaus’s Driehaus Capital had the most valuable position in The Spectranetics Corporation (NASDAQ:SPNC), worth close to $10 million, accounting for 0.4% of its total 13F portfolio. Sitting at the No. 2 spot is Manatuck Hill Partners, managed by Mark Broach, which held a $7 million position; 2.5% of its 13F portfolio is allocated to the company. Other hedgies with similar optimism include Scott Burney’s Bluefin Investment Management, Brian Ashford-Russell and Tim Woolley’s Polar Capital and SAC Subsidiary’s CR Intrinsic Investors.

Due to the fact that The Spectranetics Corporation (NASDAQ:SPNC) has experienced a declination in interest from the entirety of the hedge funds we track, logic holds that there were a few hedge funds who were dropping their full holdings last quarter. At the top of the heap, Phill Gross and Robert Atchinson’s Adage Capital Management dumped the biggest position of all the hedgies we monitor, totaling close to $5 million in stock., and Andy Redleaf of Whitebox Advisors was right behind this move, as the fund dropped about $0 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 1 funds last quarter.

What do corporate executives and insiders think about The Spectranetics Corporation (NASDAQ:SPNC)?

Insider trading activity, especially when it’s bullish, is particularly usable when the company in question has seen transactions within the past half-year. Over the latest six-month time frame, The Spectranetics Corporation (NASDAQ:SPNC) has experienced 1 unique insiders buying, and 2 insider sales (see the details of insider trades here).

With the results shown by Insider Monkey’s studies, retail investors should always keep an eye on hedge fund and insider trading sentiment, and The Spectranetics Corporation (NASDAQ:SPNC) is an important part of this process.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.