Barrick Gold Corporation (USA) (ABX): Hedge Funds Aren’t Crazy About It, Insider Sentiment Unchanged

Barrick Gold Corporation (USA) (NYSE:ABX) has seen some intriguing activity in some corners of its investing base lately. Let's take a look.

If you were to ask many of your fellow readers, hedge funds are viewed as bloated, old investment tools of an era lost to time. Although there are In excess of 8,000 hedge funds with their doors open currently, Insider Monkey aim at the masters of this group, about 525 funds. Analysts calculate that this group controls most of the smart money's total assets, and by monitoring their best stock picks, we've spotted a number of investment strategies that have historically outpaced 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 33 percentage points in 11 months (find a sample of our picks).

Just as useful, bullish insider trading activity is a second way to analyze the investments you're interested in. Obviously, there are a number of motivations for an upper level exec to drop shares of his or her company, but just one, very simple reason why they would behave bullishly. Several academic studies have demonstrated the valuable potential of this strategy if shareholders know where to look (learn more here).

What's more, it's important to discuss the latest info for Barrick Gold Corporation (USA) (NYSE:ABX).


How have hedgies been trading Barrick Gold Corporation (USA) (NYSE:ABX)?


In preparation for the third quarter, a total of 36 of the hedge funds we track were long in this stock, a change of -14% from one quarter earlier. With hedgies' capital changing hands, there exists an "upper tier" of noteworthy hedge fund managers who were boosting their stakes significantly.

Barrick Gold Corporation (USA) (NYSE:ABX)According to our 13F database, Jonathon Jacobson's Highfields Capital Management had the largest position in Barrick Gold Corporation (USA) (NYSE:ABX), worth close to $161.5 million, comprising 1.3% of its total 13F portfolio. The second largest stake is held by Michael A. Price and Amos Meron of Empyrean Capital Partners, with a $122 million call position; 2.8% of its 13F portfolio is allocated to the company. Some other hedgies that hold long positions include D. E. Shaw's D E Shaw, and Kerr Neilson's Platinum Asset Management.


As Barrick Gold Corporation (USA) (NYSE:ABX) has witnessed dropping sentiment from upper-tier hedge fund managers, logic holds that there exists a select few money managers that elected to cut their entire stakes at the end of the second quarter. Interestingly, Jeffrey Vinik's Vinik Asset Management dumped the largest position of the 450+ funds we track, comprising an estimated $88.8 million in stock, and Daniel Bubis of Tetrem Capital Management was right behind this move, as the fund dumped about $60.7 million worth. These transactions are interesting, as total hedge fund interest fell by 6 funds at the end of the second quarter.


What do corporate executives and insiders think about Barrick Gold Corporation (USA) (NYSE:ABX)?


Legal insider trading, particularly when it's bullish, is at its handiest when the company in question has experienced transactions within the past 180 days. Over the last half-year time period, Barrick Gold Corporation (USA) (NYSE:ABX) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We'll go over the relationship between both of these indicators in other stocks similar to Barrick Gold Corporation (USA) (NYSE:ABX). These stocks are AngloGold Ashanti Limited (ADR) (NYSE:AU), Kinross Gold Corporation (USA) (NYSE:KGC), Yamana Gold Inc. (USA) (NYSE:AUY), Newmont Mining Corp (NYSE:NEM), and Goldcorp Inc. (USA) (NYSE:GG). This group of stocks are the members of the gold industry and their market caps are closest to ABX's market cap.
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Company Name
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling

AngloGold Ashanti Limited (ADR) (NYSE:AU)
19
0
0

Kinross Gold Corporation (USA) (NYSE:KGC)
22
0
0

Yamana Gold Inc. (USA) (NYSE:AUY)
24
0
0

Newmont Mining Corp (NYSE:NEM)
32
1
11

Goldcorp Inc. (USA) (NYSE:GG)
19
0
0

Using the returns explained by the previously mentioned studies, regular investors must always track hedge fund and insider trading sentiment, and Barrick Gold Corporation (USA) (NYSE:ABX) is an important part of this process.

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