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Should You Buy Gold Fields Limited (ADR) (GFI)?

Gold Fields Limited (ADR) (NYSE:GFI) investors should be aware of an increase in activity from the world’s largest hedge funds of late.

In the 21st century investor’s toolkit, there are many methods investors can use to monitor the equity markets. A duo of the best are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best money managers can outpace the broader indices by a significant margin (see just how much).

Just as important, positive insider trading sentiment is a second way to parse down the stock market universe. As the old adage goes: there are a number of stimuli for an executive to get rid of shares of his or her company, but just one, very obvious reason why they would buy. Plenty of empirical studies have demonstrated the impressive potential of this method if shareholders know where to look (learn more here).

Keeping this in mind, let’s take a gander at the latest action surrounding Gold Fields Limited (ADR) (NYSE:GFI).

What does the smart money think about Gold Fields Limited (ADR) (NYSE:GFI)?

At the end of the first quarter, a total of 20 of the hedge funds we track held long positions in this stock, a change of 11% from one quarter earlier. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were upping their stakes meaningfully.

Of the funds we track, First Eagle Investment Management, managed by Jean-Marie Eveillard, holds the most valuable position in Gold Fields Limited (ADR) (NYSE:GFI). First Eagle Investment Management has a $365.6 million position in the stock, comprising 1.2% of its 13F portfolio. On First Eagle Investment Management’s heels is Paulson & Co, managed by John Paulson, which held a $50.6 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Other hedgies that are bullish include Jim Simons’s Renaissance Technologies, John Burbank’s Passport Capital and Jonathon Jacobson’s Highfields Capital Management.

Consequently, some big names were breaking ground themselves. Highfields Capital Management, managed by Jonathon Jacobson, created the largest position in Gold Fields Limited (ADR) (NYSE:GFI). Highfields Capital Management had 11.6 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $5.7 million position during the quarter. The following funds were also among the new GFI investors: David Costen Haley’s HBK Investments, Jeffrey Vinik’s Vinik Asset Management, and Mike Vranos’s Ellington.

Insider trading activity in Gold Fields Limited (ADR) (NYSE:GFI)

Insider buying is best served when the primary stock in question has experienced transactions within the past half-year. Over the last six-month time period, Gold Fields Limited (ADR) (NYSE:GFI) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Gold Fields Limited (ADR) (NYSE:GFI). These stocks are Royal Gold, Inc USA) (NASDAQ:RGLD), Compania de Minas Buenaventura SA (ADR) (NYSE:BVN), Agnico-Eagle Mines Limited (USA) (NYSE:AEM), Eldorado Gold Corp (USA) (NYSE:EGO), and Franco-Nevada Corporation (NYSE:FNV). All of these stocks are in the gold industry and their market caps match GFI’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Royal Gold, Inc USA) (NASDAQ:RGLD) 21 1 3
Compania de Minas Buenaventura SA (ADR) (NYSE:BVN) 10 0 0
Agnico-Eagle Mines Limited (USA) (NYSE:AEM) 25 0 0
Eldorado Gold Corp (USA) (NYSE:EGO) 19 0 0
Franco-Nevada Corporation (NYSE:FNV) 14 0 0

With the returns demonstrated by Insider Monkey’s strategies, retail investors should always watch hedge fund and insider trading sentiment, and Gold Fields Limited (ADR) (NYSE:GFI) shareholders fit into this picture quite nicely.

Click here to learn why you should track hedge funds

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