Is The Clorox Company (NYSE:CLX) Going to Burn These Hedge Funds?

The Clorox Company (NYSE:CLX) was in 18 hedge funds’ portfolio at the end of the fourth quarter of 2012. CLX shareholders have witnessed an increase in hedge fund interest in recent months. There were 17 hedge funds in our database with CLX positions at the end of the previous quarter.

The Clorox Co (NYSE:CLX)

In the 21st century investor’s toolkit, there are many indicators shareholders can use to analyze their holdings. A pair of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite investment managers can outperform the market by a superb margin (see just how much).

Just as beneficial, positive insider trading sentiment is a second way to break down the investments you’re interested in. As the old adage goes: there are many stimuli for an upper level exec to downsize shares of his or her company, but just one, very simple reason why they would behave bullishly. Several academic studies have demonstrated the valuable potential of this tactic if you understand where to look (learn more here).

Now, let’s take a gander at the latest action surrounding The Clorox Company (NYSE:CLX).

What does the smart money think about The Clorox Company (NYSE:CLX)?

At the end of the fourth quarter, a total of 18 of the hedge funds we track were long in this stock, a change of 6% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their holdings significantly.

According to our comprehensive database, Donald Yacktman’s Yacktman Asset Management had the biggest position in The Clorox Company (NYSE:CLX), worth close to $502 million, comprising 3% of its total 13F portfolio. The second largest stake is held by Renaissance Technologies, managed by Jim Simons, which held a $62 million position; 0.6% of its 13F portfolio is allocated to the stock. Other hedge funds that hold long positions include Christian Leone’s Luxor Capital Group, Israel Englander’s Millennium Management and Andrew Sandler’s Sandler Capital Management.

As industrywide interest jumped, some big names were leading the bulls’ herd. Sandler Capital Management, managed by Andrew Sandler, created the largest position in The Clorox Company (NYSE:CLX). Sandler Capital Management had 12 million invested in the company at the end of the quarter. Mark Kingdon’s Kingdon Capital also initiated a $8 million position during the quarter. The other funds with new positions in the stock are Anand Parekh’s Alyeska Investment Group, Steven Cohen’s SAC Capital Advisors, and Glenn Russell Dubin’s Highbridge Capital Management.

How have insiders been trading The Clorox Company (NYSE:CLX)?

Insider purchases made by high-level executives is particularly usable when the company we’re looking at has seen transactions within the past six months. Over the last half-year time frame, The Clorox Company (NYSE:CLX) has seen 1 unique insiders purchasing, and 11 insider sales (see the details of insider trades here).

With the returns shown by Insider Monkey’s studies, everyday investors should always keep an eye on hedge fund and insider trading sentiment, and The Clorox Company (NYSE:CLX) is no exception.

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.