Is Altera Corporation (NASDAQ:ALTR) Going to Burn These Hedge Funds?

Is Altera Corporation (NASDAQ:ALTR) ready to raly soon? Money managers are becoming less hopeful. The number of long hedge fund positions were cut by 4 recently.

At the moment, there are many indicators market participants can use to watch Mr. Market. Two of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top hedge fund managers can trounce the market by a solid amount (see just how much).

Altera CorporationJust as beneficial, positive insider trading activity is another way to break down the financial markets. Just as you’d expect, there are lots of reasons for an insider to sell shares of his or her company, but just one, very obvious reason why they would buy. Plenty of academic studies have demonstrated the market-beating potential of this tactic if “monkeys” know where to look (learn more here).

With these “truths” under our belt, it’s important to take a gander at the key action encompassing Altera Corporation (NASDAQ:ALTR).

Hedge fund activity in Altera Corporation (NASDAQ:ALTR)

In preparation for this year, a total of 21 of the hedge funds we track were bullish in this stock, a change of -16% from the previous quarter. With the smart money’s capital changing hands, there exists a select group of noteworthy hedge fund managers who were upping their stakes substantially.

Of the funds we track, Eagle Capital Management, managed by Boykin Curry, holds the biggest position in Altera Corporation (NASDAQ:ALTR). Eagle Capital Management has a $317 million position in the stock, comprising 2.2% of its 13F portfolio. Coming in second is Eric Bannasch of Cadian Capital, with a $118 million position; 0.2% of its 13F portfolio is allocated to the company. Other hedge funds that hold long positions include Jim Simons’s Renaissance Technologies, William von Mueffling’s Cantillon Capital Management and Ken Griffin’s Citadel Investment Group.

Judging by the fact that Altera Corporation (NASDAQ:ALTR) has experienced declining sentiment from the entirety of the hedge funds we track, it’s safe to say that there lies a certain “tier” of funds that elected to cut their positions entirely in Q4. Interestingly, Panayotis ï¾�Takisï¾� Sparaggis’s Alkeon Capital Management dumped the largest position of the 450+ funds we monitor, worth about $31 million in stock., and Van Schreiber of Bennett Lawrence Management was right behind this move, as the fund dropped about $5 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 4 funds in Q4.

What have insiders been doing with Altera Corporation (NASDAQ:ALTR)?

Insider trading activity, especially when it’s bullish, is at its handiest when the primary stock in question has experienced transactions within the past half-year. Over the latest half-year time period, Altera Corporation (NASDAQ:ALTR) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

With the results shown by Insider Monkey’s strategies, retail investors should always watch hedge fund and insider trading sentiment, and Altera Corporation (NASDAQ:ALTR) applies perfectly to this mantra.

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.