Hedge Funds Aren’t Crazy About NASDAQ OMX Group, Inc. (NDAQ) Anymore
In today’s marketplace, there are tons of metrics shareholders can use to monitor stocks. Two of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best hedge fund managers can beat the S&P 500 by a superb margin (see just how much).
Just as useful, bullish insider trading activity is another way to analyze the marketplace. As the old adage goes: there are a number of reasons for a bullish insider 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 market-beating potential of this tactic if "monkeys" know where to look (learn more here).
Furthermore, we're going to examine the newest info about NASDAQ OMX Group, Inc. (NASDAQ:NDAQ).
How have hedgies been trading NASDAQ OMX Group, Inc. (NASDAQ:NDAQ)?
At the end of the second quarter, a total of 18 of the hedge funds we track were bullish in this stock, a change of -14% from the previous quarter. With hedge funds' sentiment swirling, there exists an "upper tier" of noteworthy hedge fund managers who were boosting their stakes meaningfully.
Out of the hedge funds we follow, Ken Griffin's Citadel Investment Group had the biggest position in NASDAQ OMX Group, Inc. (NASDAQ:NDAQ), worth close to $62.6 million, accounting for 0.1% of its total 13F portfolio. On Citadel Investment Group's heels is Winton Capital Management, managed by David Harding, which held a $44.5 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Anthony Bozza's Lakewood Capital Management, Spencer M. Waxman's Shannon River Fund Management and Jim Simons's Renaissance Technologies.
Judging by the fact that NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) has witnessed a fall in interest from the smart money's best and brightest, it's safe to say that there exists a select few money managers that slashed their full holdings last quarter. Interestingly, Daniel Lewis's Orange Capital dropped the largest stake of all the hedgies we watch, totaling about $38 million in stock, and James H. Litinsky of JHL Capital Group was right behind this move, as the fund sold off about $25.8 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 3 funds last quarter.
How are insiders trading NASDAQ OMX Group, Inc. (NASDAQ:NDAQ)?
Insider buying made by high-level executives is most useful when the primary stock in question has experienced transactions within the past 180 days. Over the latest six-month time frame, NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) has seen 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 NASDAQ OMX Group, Inc. (NASDAQ:NDAQ). These stocks are IntercontinentalExchange Inc (NYSE:ICE), Apollo Global Management LLC (NYSE:APO), NYSE Euronext (NYSE:NYX), CBOE Holdings, Inc (NASDAQ:CBOE), and Ares Capital Corporation (NASDAQ:ARCC). This group of stocks are the members of the diversified investments industry and their market caps match NDAQ's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
IntercontinentalExchange Inc (NYSE:ICE)
Apollo Global Management LLC (NYSE:APO)
NYSE Euronext (NYSE:NYX)
CBOE Holdings, Inc (NASDAQ:CBOE)
Ares Capital Corporation (NASDAQ:ARCC)
Using the returns shown by our tactics, regular investors must always track hedge fund and insider trading sentiment, and NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) applies perfectly to this mantra.