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I’d Avoid Hartford Financial Services Group Inc (HIG)

Hartford Financial Services Group Inc (NYSE:HIG) has seen a slight declination in hedge fund interest of late, and with not a bullish insider in sight. I’d avoid it.

To many of your fellow readers, hedge funds are seen as overrated, old investment tools of a period lost to current times. Although there are more than 8,000 hedge funds in operation in present day, Insider Monkey looks at the bigwigs of this group, close to 525 funds. It is widely held that this group has its hands on most of the hedge fund industry’s total assets, and by watching their highest quality stock picks, we’ve deciphered a number of investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually 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 outperformed the S&P 500 index by 33 percentage points in 11 months (see all of our picks from August).

Equally as necessary, optimistic insider trading sentiment is another way to analyze the marketplace. As the old adage goes: there are lots of stimuli for an insider to drop shares of his or her company, but just one, very clear reason why they would behave bullishly. Several empirical studies have demonstrated the impressive potential of this strategy if shareholders know where to look (learn more here).

Now that that’s out of the way, it’s important to study the latest info surrounding Hartford Financial Services Group Inc (NYSE:HIG).

How are hedge funds trading Hartford Financial Services Group Inc (NYSE:HIG)?

At the end of the second quarter, a total of 43 of the hedge funds we track were long in this stock, a change of -2% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were upping their stakes meaningfully.

Hartford Financial Services Group Inc (NYSE:HIG)According to our 13F database, Louis Bacon’s Moore Global Investments had the largest position in Hartford Financial Services Group Inc (NYSE:HIG), worth close to $241.2 million, accounting for 5.8% of its total 13F portfolio. The second largest stake is held by Steven Richman of East Side Capital (RR Partners), with a $237.1 million position; the fund has 11.5% of its 13F portfolio invested in the stock. Other hedge funds that hold long positions include Matthew Hulsizer’s PEAK6 Capital Management, John Paulson’s Paulson & Co and David Tepper’s Appaloosa Management LP.

As Hartford Financial Services Group Inc (NYSE:HIG) has witnessed bearish sentiment from upper-tier hedge fund managers, we can see that there is a sect of hedge funds who were dropping their entire stakes heading into Q2. It’s worth mentioning that James Dinan’s York Capital Management dumped the largest position of all the hedgies we monitor, valued at an estimated $99.5 million in stock, and Larry Robbins of Glenview Capital was right behind this move, as the fund cut about $29.1 million worth. These transactions are intriguing to say the least, as total hedge fund interest was cut by 1 funds heading into Q2.

How have insiders been trading Hartford Financial Services Group Inc (NYSE:HIG)?

Bullish insider trading is most useful when the primary stock in question has experienced transactions within the past 180 days. Over the last six-month time period, Hartford Financial Services Group Inc (NYSE:HIG) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also take a look at the relationship between both of these indicators in other stocks similar to Hartford Financial Services Group Inc (NYSE:HIG). These stocks are Cincinnati Financial Corporation (NASDAQ:CINF), Everest Re Group Ltd (NYSE:RE), The Progressive Corporation (NYSE:PGR), Cna Financial Corp (NYSE:CNA), and XL Group plc (NYSE:XL). All of these stocks are in the property & casualty insurance industry and their market caps are similar to HIG’s market cap.

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