Is Validus Holdings, Ltd. (VR) Going to Burn These Hedge Funds?

Is it smart to be bullish on Validus Holdings, Ltd. (NYSE:VR)?

In the financial world, there are tons of gauges market participants can use to monitor the equity markets. Two of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best hedge fund managers can beat the broader indices by a superb margin (see just how much).

Just as necessary, optimistic insider trading sentiment is another way to analyze the world of equities. Obviously, there are plenty of stimuli for an insider to cut shares of his or her company, but only one, very clear reason why they would initiate a purchase. Various empirical studies have demonstrated the useful potential of this method if investors know where to look (learn more here).

Furthermore, we’re going to analyze the latest info about Validus Holdings, Ltd. (NYSE:VR).

Validus Holdings, Ltd. (NYSE:VR)

How have hedgies been trading Validus Holdings, Ltd. (NYSE:VR)?

Heading into Q3, a total of 23 of the hedge funds we track were bullish in this stock, a change of 5% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully.

When using filings from the hedgies we track, Adage Capital Management, managed by Phill Gross and Robert Atchinson, holds the most valuable position in Validus Holdings, Ltd. (NYSE:VR). Adage Capital Management has a $39.6 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Omega Advisors, managed by Leon Cooperman, which held a $35.8 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Other hedgies with similar optimism include Israel Englander’s Millennium Management, Ken Griffin’s Citadel Investment Group and D. E. Shaw’s D E Shaw.

With a general bullishness amongst the titans, specific money managers were breaking ground themselves. Adage Capital Management, managed by Phill Gross and Robert Atchinson, created the biggest position in Validus Holdings, Ltd. (NYSE:VR). Adage Capital Management had 39.6 million invested in the company at the end of the quarter. Leon Cooperman’s Omega Advisors also made a $35.8 million investment in the stock during the quarter. The other funds with brand new VR positions are Israel Englander’s Millennium Management, Ken Griffin’s Citadel Investment Group, and D. E. Shaw’s D E Shaw.

How are insiders trading Validus Holdings, Ltd. (NYSE:VR)?

Legal insider trading, particularly when it’s bullish, is at its handiest when the company in focus has seen transactions within the past six months. Over the last half-year time period, Validus Holdings, Ltd. (NYSE:VR) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also examine the relationship between both of these indicators in other stocks similar to Validus Holdings, Ltd. (NYSE:VR). These stocks are Markel Corporation (NYSE:MKL), White Mountains Insurance Group Ltd (NYSE:WTM), HCC Insurance Holdings, Inc. (NYSE:HCC), American Financial Group (NYSE:AFG), and RenaissanceRe Holdings Ltd. (NYSE:RNR). This group of stocks belong to the property & casualty insurance industry and their market caps are similar to VR’s market cap.