The Blackstone Group L.P. (NYSE:BX) shareholders have witnessed an increase in enthusiasm from smart money lately.
According to most market participants, hedge funds are viewed as worthless, outdated financial vehicles of years past. While there are over 8000 funds trading at the moment, we at Insider Monkey hone in on the bigwigs of this group, about 450 funds. It is widely believed that this group has its hands on most of the smart money’s total asset base, and by tracking their best equity investments, we have unsheathed a few investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy outpaced 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 outclassed the S&P 500 index by 25 percentage points in 6.5 month (see the details here).
Just as beneficial, positive insider trading activity is another way to break down the stock market universe. Obviously, there are a variety of incentives for an insider to downsize shares of his or her company, but just one, very simple reason why they would initiate a purchase. Many empirical studies have demonstrated the market-beating potential of this method if “monkeys” understand where to look (learn more here).
Now, we’re going to take a look at the latest action regarding The Blackstone Group L.P. (NYSE:BX).
Hedge fund activity in The Blackstone Group L.P. (NYSE:BX)
Heading into 2013, a total of 22 of the hedge funds we track were bullish in this stock, a change of 16% from one quarter earlier. With the smart money’s sentiment swirling, there exists a few key hedge fund managers who were increasing their stakes meaningfully.
Of the funds we track, Select Equity Group, managed by Robert Joseph Caruso, holds the biggest position in The Blackstone Group L.P. (NYSE:BX). Select Equity Group has a $124 million call position in the stock, comprising 1.9% of its 13F portfolio. Coming in second is John W. Rogers of Ariel Investments, with a $56 million position; the fund has 1.2% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Paul Ruddockáand Steve Heinz’s Lansdowne Partners and John A. Levin’s Levin Capital Strategies.
As one would reasonably expect, key hedge funds were breaking ground themselves. Eminence Capital, managed by Ricky Sandler, initiated the largest position in The Blackstone Group L.P. (NYSE:BX). Eminence Capital had 8 million invested in the company at the end of the quarter. Curtis Schenker and Craig Effron’s Scoggin also made a $2 million investment in the stock during the quarter. The other funds with new positions in the stock are Richard Driehaus’s Driehaus Capital and Drew Cupps’s Cupps Capital Management.
How are insiders trading The Blackstone Group L.P. (NYSE:BX)?
Insider buying is at its handiest when the company we’re looking at has seen transactions within the past half-year. Over the latest half-year time frame, The Blackstone Group L.P. (NYSE:BX) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
With the returns shown by our studies, everyday investors should always keep an eye on hedge fund and insider trading sentiment, and The Blackstone Group L.P. (NYSE:BX) is no exception.
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.