In the eyes of most traders, hedge funds are seen as slow, outdated financial tools of yesteryear. While there are greater than 8000 funds in operation at present, we hone in on the elite of this club, around 450 funds. It is widely believed that this group oversees the majority of all hedge funds’ total capital, and by tracking their best picks, we have deciphered a number of investment strategies that have historically outpaced the S&P 500 index. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).
Just as important, bullish insider trading activity is another way to parse down the investments you’re interested in. There are many motivations for a corporate insider to sell shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several academic studies have demonstrated the valuable potential of this strategy if piggybackers know what to do (learn more here).
Keeping this in mind, let’s take a glance at the key action encompassing Mizuho Financial Group, Inc. (TYO:8411)’s ADR shares.
How are hedge funds trading Mizuho Financial Group, Inc. (TYO:8411)’s ADR shares?
Heading into 2013, a total of 5 of the hedge funds we track were long in this stock, a change of 0% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were upping their stakes meaningfully.
Of the funds we track, Jim Simons’s Renaissance Technologies had the largest position in Mizuho Financial Group, Inc. (TYO:8411)’s ADR shares, worth close to $2.4 million, comprising less than 0.1%% of its total 13F portfolio. Coming in second is D E Shaw, managed by D. E. Shaw, which held a $1 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Other hedge funds that hold long positions include Israel Englander’s Millennium Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Steven Cohen’s SAC Capital Advisors.
Due to the fact that Mizuho Financial Group, Inc. (TYO:8411)’s ADR shares have experienced bearish sentiment from the entirety of the hedge funds we track, logic holds that there lies a certain “tier” of money managers who were dropping their full holdings heading into 2013. Interestingly, Louis Navellier’s Navellier & Associates dropped the biggest investment of the 450+ funds we monitor, worth close to $0.3 million in stock. These moves are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
How are insiders trading Mizuho Financial Group, Inc. (TYO:8411)’s ADR shares?
Bullish insider trading is best served when the company in question has seen transactions within the past half-year. Over the last 180-day time frame, Mizuho Financial Group, Inc. (TYO:8411)’s ADR shares have experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Mizuho Financial Group Inc. (ADR) (NYSE:MFG), and subsequently Mizuho Financial Group, Inc. (TYO:8411). These stocks are Deutsche Bank AG (USA) (NYSE:DB), Banco Bradesco S.A. (NYSE:BBDO), Banco Bradesco SA (ADR) (NYSE:BBD), Sumitomo Mitsui Financial Group, Inc. (TYO:8316)’s ADR shares, and Banco Bilbao Vizcaya Argentaria SA (ADR) (NYSE:BBVA). All of these stocks are in the foreign regional banks industry and their market caps match MFG’s market cap.