Watts Water Technologies Inc (NYSE:WTS) investors should pay attention to an increase in activity from the world’s largest hedge funds lately.
According to most stock holders, hedge funds are viewed as unimportant, outdated investment tools of the past. While there are over 8000 funds in operation today, we look at the masters of this club, around 450 funds. It is estimated that this group has its hands on the lion’s share of the smart money’s total asset base, and by watching their best picks, we have unsheathed a few investment strategies that have historically outpaced the broader indices. Our small-cap hedge fund strategy outperformed 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 beaten the S&P 500 index by 25 percentage points in 6.5 month (see all of our picks from August).
Equally as key, optimistic insider trading activity is a second way to break down the world of equities. Obviously, there are plenty of stimuli for a bullish insider to get rid of shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Plenty of academic studies have demonstrated the market-beating potential of this method if investors understand what to do (learn more here).
Keeping this in mind, we’re going to take a glance at the recent action surrounding Watts Water Technologies Inc (NYSE:WTS).
What have hedge funds been doing with Watts Water Technologies Inc (NYSE:WTS)?
At year’s end, a total of 15 of the hedge funds we track were bullish in this stock, a change of 50% from the third quarter. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were boosting their stakes significantly.
Of the funds we track, Mario Gabelli’s GAMCO Investors had the most valuable position in Watts Water Technologies Inc (NYSE:WTS), worth close to $84 million, accounting for 0.6% of its total 13F portfolio. The second largest stake is held by Pivot Point Capital, managed by James A. Noonan, which held a $21 million position; the fund has 14.4% of its 13F portfolio invested in the stock. Other peers that hold long positions include John I. Dickerson’s Summit Global Management, Abby Flamholz and Yehuda Blinder’s ADAR Investment Management and Jacob Gottlieb’s Visium Asset Management.
As one would reasonably expect, specific money managers have jumped into Watts Water Technologies Inc (NYSE:WTS) headfirst. Visium Asset Management, managed by Jacob Gottlieb, initiated the most valuable position in Watts Water Technologies Inc (NYSE:WTS). Visium Asset Management had 3 million invested in the company at the end of the quarter. Israel Englander’s Catapult Capital Management also initiated a $1 million position during the quarter. The following funds were also among the new WTS investors: Neil Chriss’s Hutchin Hill Capital, Steven Cohen’s SAC Capital Advisors, and Israel Englander’s Millennium Management.
What do corporate executives and insiders think about Watts Water Technologies Inc (NYSE:WTS)?
Insider purchases made by high-level executives is most useful when the company in focus has experienced transactions within the past six months. Over the latest six-month time period, Watts Water Technologies Inc (NYSE:WTS) has seen zero unique insiders buying, and 4 insider sales (see the details of insider trades here).
With the returns exhibited by the aforementioned time-tested strategies, everyday investors should always watch hedge fund and insider trading sentiment, and Watts Water Technologies Inc (NYSE:WTS) is an important part of this process.
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