Is SWS Group, Inc. (NYSE:SWS) a healthy stock for your portfolio? Investors who are in the know are becoming less hopeful. The number of long hedge fund bets stayed the same which is a slightly negative development in our experience
In the financial world, there are tons of gauges shareholders can use to monitor stocks. A duo of the most useful are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top hedge fund managers can outperform the market by a healthy margin (see just how much).
Equally as important, bullish insider trading sentiment is a second way to break down the investments you’re interested in. There are a number of motivations for an upper level exec to cut shares of his or her company, but only one, very simple reason why they would buy. Various academic studies have demonstrated the useful potential of this strategy if piggybackers know what to do (learn more here).
Consequently, it’s important to take a look at the key action encompassing SWS Group, Inc. (NYSE:SWS).
How have hedgies been trading SWS Group, Inc. (NYSE:SWS)?
At the end of the first quarter, a total of 8 of the hedge funds we track were long in this stock, a change of 0% from the first quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes meaningfully.
When looking at the hedgies we track, Zac Hirzel’s Hirzel Capital Management had the most valuable position in SWS Group, Inc. (NYSE:SWS), worth close to $9.4 million, comprising 3.3% of its total 13F portfolio. On Hirzel Capital Management’s heels is Highland Capital Management, managed by James Dondero, which held a $9 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Other peers that hold long positions include Mario Gabelli’s GAMCO Investors, Phil Frohlich’s Prescott Group Capital Management and Ken Griffin’s Citadel Investment Group.
Seeing as SWS Group, Inc. (NYSE:SWS) has experienced a declination in interest from the smart money, it’s easy to see that there lies a certain “tier” of money managers that slashed their full holdings in Q1. Intriguingly, Charles Davidson’s Wexford Capital dumped the largest stake of the 450+ funds we track, totaling close to $0.2 million in stock. These moves are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Insider trading activity in SWS Group, Inc. (NYSE:SWS)
Insider buying is at its handiest when the primary stock in question has seen transactions within the past six months. Over the latest 180-day time period, SWS Group, Inc. (NYSE:SWS) has experienced zero unique insiders buying, and 1 insider sales (see the details of insider trades here).
With the results demonstrated by Insider Monkey’s time-tested strategies, retail investors should always monitor hedge fund and insider trading activity, and SWS Group, Inc. (NYSE:SWS) is an important part of this process.