Retail Properties of America Inc (NYSE:RPAI) was in 10 hedge funds’ portfolio at the end of the first quarter of 2013. RPAI has seen an increase in activity from the world’s largest hedge funds of late. There were 7 hedge funds in our database with RPAI holdings at the end of the previous quarter.
To the average investor, there are tons of indicators investors can use to watch stocks. A pair of the most useful are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best hedge fund managers can beat the S&P 500 by a superb amount (see just how much).
Just as key, positive insider trading sentiment is another way to parse down the financial markets. As the old adage goes: there are plenty of motivations for an executive to downsize shares of his or her company, but only one, very clear reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the market-beating potential of this tactic if piggybackers know what to do (learn more here).
Consequently, it’s important to take a gander at the recent action encompassing Retail Properties of America Inc (NYSE:RPAI).
How are hedge funds trading Retail Properties of America Inc (NYSE:RPAI)?
At Q1’s end, a total of 10 of the hedge funds we track were long in this stock, a change of 43% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their stakes significantly.
When looking at the hedgies we track, J. Alan Reid, Jr.’s Forward Management had the biggest position in Retail Properties of America Inc (NYSE:RPAI), worth close to $24.8 million, accounting for 1.5% of its total 13F portfolio. Sitting at the No. 2 spot is Jeffrey Furber of AEW Capital Management, with a $18.7 million position; 0.5% of its 13F portfolio is allocated to the company. Some other peers that hold long positions include D. E. Shaw’s D E Shaw, Israel Englander’s Millennium Management and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
With a general bullishness amongst the heavyweights, specific money managers were breaking ground themselves. Stevens Capital Management, managed by Matthew Tewksbury, created the most outsized position in Retail Properties of America Inc (NYSE:RPAI). Stevens Capital Management had 1.4 million invested in the company at the end of the quarter. Mike Vranos’s Ellington also made a $0.5 million investment in the stock during the quarter. The only other fund with a new position in the stock is David Costen Haley’s HBK Investments.
What do corporate executives and insiders think about Retail Properties of America Inc (NYSE:RPAI)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company we’re looking at has experienced transactions within the past 180 days. Over the latest half-year time frame, Retail Properties of America Inc (NYSE:RPAI) has experienced 3 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Retail Properties of America Inc (NYSE:RPAI). These stocks are Newcastle Investment Corp. (NYSE:NCT), Starwood Property Trust, Inc. (NYSE:STWD), Chimera Investment Corporation (NYSE:CIM), Douglas Emmett, Inc. (NYSE:DEI), and MFA Financial, Inc. (NYSE:MFA). This group of stocks are the members of the reit – diversified industry and their market caps are closest to RPAI’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Newcastle Investment Corp. (NYSE:NCT)||39||2||0|
|Starwood Property Trust, Inc. (NYSE:STWD)||23||0||1|
|Chimera Investment Corporation (NYSE:CIM)||22||0||0|
|Douglas Emmett, Inc. (NYSE:DEI)||8||0||1|
|MFA Financial, Inc. (NYSE:MFA)||21||3||0|
With the returns demonstrated by our studies, retail investors should always pay attention to hedge fund and insider trading activity, and Retail Properties of America Inc (NYSE:RPAI) shareholders fit into this picture quite nicely.