This Metric Says You Are Smart to Sell CorVel Corporation (CRVL)

Is CorVel Corporation (NASDAQ:CRVL) going to take off soon? The best stock pickers are taking a pessimistic view. The number of bullish hedge fund bets stayed the same which is a slightly negative development in our experience

In the financial world, there are plenty of methods market participants can use to track stocks. Some of the most under-the-radar are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top fund managers can beat the S&P 500 by a significant amount (see just how much).

RENAISSANCE TECHNOLOGIESJust as important, bullish insider trading activity is a second way to parse down the stock market universe. As the old adage goes: there are plenty of stimuli for an insider to get rid of shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Various empirical studies have demonstrated the useful potential of this strategy if “monkeys” know what to do (learn more here).

With all of this in mind, let’s take a peek at the latest action encompassing CorVel Corporation (NASDAQ:CRVL).

What have hedge funds been doing with CorVel Corporation (NASDAQ:CRVL)?

At Q1’s end, a total of 5 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were increasing their stakes substantially.

Of the funds we track, Arthur B Cohen and Joseph Healey’s Healthcor Management LP had the biggest position in CorVel Corporation (NASDAQ:CRVL), worth close to $26.2 million, accounting for 1.1% of its total 13F portfolio. The second largest stake is held by Jim Simons of Renaissance Technologies, with a $24.9 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedge funds that are bullish include Chuck Royce’s Royce & Associates, Joel Greenblatt’s Gotham Asset Management and John Overdeck and David Siegel’s Two Sigma Advisors.

Seeing as CorVel Corporation (NASDAQ:CRVL) has witnessed declining sentiment from the entirety of the hedge funds we track, logic holds that there was a specific group of funds who were dropping their entire stakes in Q1. At the top of the heap, Israel Englander’s Millennium Management cut the biggest stake of the “upper crust” of funds we watch, totaling an estimated $0.6 million in stock. These moves are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

How have insiders been trading CorVel Corporation (NASDAQ:CRVL)?

Insider buying is most useful when the company we’re looking at has seen transactions within the past half-year. Over the last half-year time frame, CorVel Corporation (NASDAQ:CRVL) has seen zero unique insiders purchasing, and 5 insider sales (see the details of insider trades here).

With the returns shown by the aforementioned tactics, everyday investors must always watch hedge fund and insider trading activity, and CorVel Corporation (NASDAQ:CRVL) applies perfectly to this mantra.

Click here to learn why you should track hedge funds