Ixia (XXIA): Hedge Funds Are Bearish and Insiders Are Undecided, What Should You Do?

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Is it smart to be bullish on Ixia (NASDAQ:XXIA)?

Now, according to many traders, hedge funds are assumed to be overrated, old investment tools of a period lost to current times. Although there are over 8,000 hedge funds trading today, this site looks at the bigwigs of this club, close to 525 funds. It is assumed that this group controls the lion’s share of the hedge fund industry’s total capital, and by keeping an eye on their highest performing picks, we’ve brought to light a few investment strategies that have historically beaten 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 started sharing our picks with our subscribers at the end of August 2012, we have outpaced the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).


Just as key, bullish insider trading sentiment is a second way to look at the marketplace. Just as you’d expect, there are lots of motivations for an insider to sell shares of his or her company, but just one, very simple reason why they would buy. Plenty of academic studies have demonstrated the valuable potential of this tactic if you know what to do (learn more here).

What’s more, we’re going to examine the latest info about Ixia (NASDAQ:XXIA).

What does the smart money think about Ixia (NASDAQ:XXIA)?

At Q2’s end, a total of 6 of the hedge funds we track held long positions in this stock, a change of -40% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were increasing their stakes significantly.

Out of the hedge funds we follow, Donald Chiboucis’s Columbus Circle Investors had the most valuable position in Ixia (NASDAQ:XXIA), worth close to $34.1 million, comprising 0.3% of its total 13F portfolio. On Columbus Circle Investors’s heels is Polar Capital, managed by Brian Ashford-Russell and Tim Woolley, which held a $9.4 million position; 0.3% of its 13F portfolio is allocated to the stock. Remaining peers with similar optimism include Mario Gabelli’s GAMCO Investors, Ken Griffin’s Citadel Investment Group and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.

Since Ixia (NASDAQ:XXIA) has faced bearish sentiment from the top-tier hedge fund industry, it’s easy to see that there exists a select few hedgies that slashed their positions entirely heading into Q2. Interestingly, Richard Driehaus’s Driehaus Capital dropped the largest position of the 450+ funds we watch, comprising an estimated $4 million in stock. Paul Tudor Jones’s fund, Tudor Investment Corp, also cut its stock, about $0.4 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest was cut by 4 funds heading into Q2.

Insider trading activity in Ixia (NASDAQ:XXIA)

Insider buying is most useful when the company in focus has seen transactions within the past 180 days. Over the latest half-year time period, Ixia (NASDAQ:XXIA) has seen 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 Ixia (NASDAQ:XXIA). These stocks are Coherent, Inc. (NASDAQ:COHR), Itron, Inc. (NASDAQ:ITRI), Cognex Corporation (NASDAQ:CGNX), Geospace Technologies Corp (NASDAQ:GEOS), and Curtiss-Wright Corp. (NYSE:CW). This group of stocks are in the scientific & technical instruments industry and their market caps are similar to XXIA’s market cap.

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