Is Lloyds Banking Group PLC (ADR) (NYSE:LYG) a good investment?
In the 21st century investor’s toolkit, there are dozens of metrics market participants can use to analyze their holdings. A pair of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best fund managers can outpace the market by a solid margin (see just how much).
Equally as useful, optimistic insider trading activity is a second way to look at the investments you’re interested in. Obviously, there are lots of incentives for a bullish insider to downsize shares of his or her company, but just one, very obvious reason why they would buy. Plenty of empirical studies have demonstrated the valuable potential of this method if shareholders know where to look (learn more here).
Thus, we’re going to discuss the newest info about Lloyds Banking Group PLC (ADR) (NYSE:LYG).
What does the smart money think about Lloyds Banking Group PLC (ADR) (NYSE:LYG)?
At Q2’s end, a total of 6 of the hedge funds we track were bullish in this stock, a change of -33% from the previous quarter. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were increasing their stakes considerably.
When using filings from the hedgies we track, Vertex One Asset Management, managed by John Thiessen, holds the largest position in Lloyds Banking Group PLC (ADR) (NYSE:LYG). Vertex One Asset Management has a $28.1 million position in the stock, comprising 4.9% of its 13F portfolio. The second largest stake is held by Peter Rathjens, Bruce Clarke and John Campbell of Arrowstreet Capital, with a $6.3 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other hedgies with similar optimism include Matthew Hulsizer’s PEAK6 Capital Management, Jim Simons’s Renaissance Technologies and Ken Griffin’s Citadel Investment Group.
As Lloyds Banking Group PLC (ADR) (NYSE:LYG) has faced bearish sentiment from the smart money’s best and brightest, it’s safe to say that there lies a certain “tier” of funds that elected to cut their positions entirely in Q1. It’s worth mentioning that Israel Englander’s Millennium Management cut the largest stake of all the hedgies we key on, comprising an estimated $1.4 million in stock. Joe DiMenna’s fund, ZWEIG DIMENNA PARTNERS, also dropped its stock, about $0.4 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest fell by 3 funds in Q1.
How are insiders trading Lloyds Banking Group PLC (ADR) (NYSE:LYG)?
Legal insider trading, particularly when it’s bullish, is particularly usable when the company in question has seen transactions within the past six months. Over the last half-year time frame, Lloyds Banking Group PLC (ADR) (NYSE:LYG) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll check out the relationship between both of these indicators in other stocks similar to Lloyds Banking Group PLC (ADR) (NYSE:LYG). These stocks are Credit Suisse Group AG (ADR) (NYSE:CS), Banco Santander, S.A. (ADR) (NYSE:SAN), Royal Bank of Scotland Group plc (ADR) (NYSE:RBS), UBS AG (USA) (NYSE:UBS), and Barclays PLC (ADR) (NYSE:BCS). This group of stocks belong to the foreign money center banks industry and their market caps are closest to LYG’s market cap.