Is Westport Innovations Inc. (USA) (NASDAQ:WPRT) worth your attention right now? Prominent investors are becoming less hopeful. The number of bullish hedge fund positions went down by 4 recently.
If you’d ask most investors, hedge funds are perceived as slow, old investment vehicles of years past. While there are greater than 8000 funds trading today, we look at the aristocrats of this group, about 450 funds. It is widely believed that this group controls the lion’s share of all hedge funds’ total asset base, and by keeping an eye on their highest performing equity investments, we have formulated a number of investment strategies that have historically outperformed the broader indices. 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 23.3 percentage points in 8 months (check out a sample of our picks).
Just as important, bullish insider trading activity is a second way to parse down the marketplace. Just as you’d expect, there are lots of reasons for an executive to sell shares of his or her company, but just one, very obvious reason why they would buy. Various academic studies have demonstrated the useful potential of this tactic if “monkeys” know what to do (learn more here).
Keeping this in mind, we’re going to take a look at the key action encompassing Westport Innovations Inc. (USA) (NASDAQ:WPRT).
How are hedge funds trading Westport Innovations Inc. (USA) (NASDAQ:WPRT)?
At Q1’s end, a total of 13 of the hedge funds we track held long positions in this stock, a change of -24% from the previous quarter.
Since Westport Innovations Inc. (USA) (NASDAQ:WPRT) has witnessed bearish sentiment from the aggregate hedge fund industry, it’s safe to say that there was a specific group of hedge funds who were dropping their positions entirely in Q1. Interestingly, Andrew Spokes’s Farallon Capital dumped the biggest stake of all the hedgies we watch, totaling an estimated $13.1 million in stock. John A. Levin’s fund, Levin Capital Strategies, also dumped its stock, about $2.6 million worth. These transactions are important to note, as aggregate hedge fund interest was cut by 4 funds in Q1.
What have insiders been doing with Westport Innovations Inc. (USA) (NASDAQ:WPRT)?
Insider buying is best served when the company we’re looking at has seen transactions within the past six months. Over the latest six-month time frame, Westport Innovations Inc. (USA) (NASDAQ:WPRT) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
With the results demonstrated by our tactics, everyday investors must always keep an eye on hedge fund and insider trading sentiment, and Westport Innovations Inc. (USA) (NASDAQ:WPRT) shareholders fit into this picture quite nicely.