Is TW Telecom Inc (NASDAQ:TWTC) a healthy stock for your portfolio? Investors who are in the know are in a bullish mood. The number of long hedge fund bets rose by 2 in recent months.
If you’d ask most shareholders, hedge funds are assumed to be slow, outdated investment vehicles of yesteryear. While there are greater than 8000 funds with their doors open at the moment, we choose to focus on the top tier of this group, around 450 funds. It is estimated that this group oversees most of the smart money’s total capital, and by monitoring their highest performing investments, we have brought to light a few investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outpaced 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 integral, optimistic insider trading sentiment is a second way to parse down the investments you’re interested in. As the old adage goes: there are a variety of motivations for an executive to sell shares of his or her company, but only one, very clear reason why they would buy. Various academic studies have demonstrated the useful potential of this strategy if “monkeys” understand what to do (learn more here).
With these “truths” under our belt, let’s take a look at the latest action regarding TW Telecom Inc (NASDAQ:TWTC).
What have hedge funds been doing with TW Telecom Inc (NASDAQ:TWTC)?
Heading into 2013, a total of 25 of the hedge funds we track were long in this stock, a change of 9% from one quarter earlier. With hedge funds’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were upping their stakes substantially.
According to our comprehensive database, Mason Hawkins’s Southeastern Asset Management had the largest position in TW Telecom Inc (NASDAQ:TWTC), worth close to $324 million, comprising 1.4% of its total 13F portfolio. Sitting at the No. 2 spot is Jim Simons of Renaissance Technologies, with a $95 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Doug Silverman’s Senator Investment Group, Keith Meister’s Corvex Capital and James Dinan’s York Capital Management.
As aggregate interest increased, some big names were breaking ground themselves. Senator Investment Group, managed by Doug Silverman, initiated the most outsized position in TW Telecom Inc (NASDAQ:TWTC). Senator Investment Group had 53 million invested in the company at the end of the quarter. James Dinan’s York Capital Management also initiated a $43 million position during the quarter. The other funds with new positions in the stock are Nick Niell’s Arrowgrass Capital Partners, Jonathon Jacobson’s Highfields Capital Management, and SAC Subsidiary’s CR Intrinsic Investors.
How are insiders trading TW Telecom Inc (NASDAQ:TWTC)?
Bullish insider trading is particularly usable when the company in focus has seen transactions within the past six months. Over the latest six-month time frame, TW Telecom Inc (NASDAQ:TWTC) has experienced zero unique insiders buying, and 9 insider sales (see the details of insider trades here).
With the returns exhibited by the aforementioned studies, everyday investors must always keep an eye on hedge fund and insider trading activity, and TW Telecom Inc (NASDAQ:TWTC) shareholders fit into this picture quite nicely.
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