CapLease, Inc. (NYSE:LSE) has seen a decrease in hedge fund interest recently.
If you’d ask most market participants, hedge funds are assumed to be worthless, outdated investment vehicles of the past. While there are more than 8000 funds with their doors open at the moment, we look at the masters of this group, close to 450 funds. It is widely believed that this group controls most of all hedge funds’ total asset base, and by keeping an eye on their highest performing equity investments, we have spotted a number of investment strategies that have historically outperformed the S&P 500 index. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually 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 topped the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).
Just as beneficial, bullish insider trading activity is a second way to break down the financial markets. As the old adage goes: there are lots of stimuli for a corporate insider to cut shares of his or her company, but only one, very simple reason why they would behave bullishly. Plenty of empirical studies have demonstrated the useful potential of this tactic if investors know what to do (learn more here).
Now, it’s important to take a glance at the recent action encompassing CapLease, Inc. (NYSE:LSE).
How are hedge funds trading CapLease, Inc. (NYSE:LSE)?
At year’s end, a total of 7 of the hedge funds we track were long in this stock, a change of -13% from one quarter earlier. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were increasing their holdings meaningfully.
According to our comprehensive database, Renaissance Technologies, managed by Jim Simons, holds the biggest position in CapLease, Inc. (NYSE:LSE). Renaissance Technologies has a $2.4 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On Renaissance Technologies’s heels is D E Shaw, managed by D. E. Shaw, which held a $2.3 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other hedgies that are bullish include Joseph A. Jolson’s Harvest Capital Strategies, Israel Englander’s Millennium Management and John Overdeck and David Siegel’s Two Sigma Advisors.
Because CapLease, Inc. (NYSE:LSE) has experienced bearish sentiment from the smart money, logic holds that there is a sect of funds who were dropping their full holdings at the end of the year. Intriguingly, Mike Vranos’s Ellington said goodbye to the biggest position of the 450+ funds we track, comprising about $0.2 million in stock. These transactions are interesting, as total hedge fund interest was cut by 1 funds at the end of the year.
How have insiders been trading CapLease, Inc. (NYSE:LSE)?
Insider buying is particularly usable when the company in focus has seen transactions within the past 180 days. Over the latest 180-day time frame, CapLease, Inc. (NYSE:LSE) has seen 1 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to CapLease, Inc. (NYSE:LSE). These stocks are Hudson Pacific Properties Inc (NYSE:HPP), Franklin Street Properties Corp. (NYSEAMEX:FSP), Select Income REIT (NYSE:SIR), First Potomac Realty Trust (NYSE:FPO), and CoreSite Realty Corp (NYSE:COR). This group of stocks belong to the reit – office industry and their market caps match LSE’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Hudson Pacific Properties Inc (NYSE:HPP)||5||0||1|
|Franklin Street Properties Corp. (NYSEAMEX:FSP)||2||1||0|
|Select Income REIT (NYSE:SIR)||11||0||0|
|First Potomac Realty Trust (NYSE:FPO)||7||1||1|
|CoreSite Realty Corp (NYSE:COR)||2||0||4|
With the results exhibited by the aforementioned research, retail investors must always watch hedge fund and insider trading sentiment, and CapLease, Inc. (NYSE:LSE) applies perfectly to this mantra.