Is Mag Silver Corp (USA) (MVG) Going to Burn These Hedge Funds?
Should Mag Silver Corp (USA) (NYSEAMEX:MVG) investors track the following data?
In the eyes of many traders, hedge funds are viewed as overrated, old investment tools of an era lost to time. Although there are more than 8,000 hedge funds trading in present day, Insider Monkey focuses on the masters of this club, close to 525 funds. It is widely held that this group controls the majority of the hedge fund industry's total assets, and by keeping an eye on their best equity investments, we've discovered a few investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per year 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 outclassed the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).
Equally as useful, optimistic insider trading activity is a second way to look at the marketplace. Obviously, there are many reasons for an executive to downsize 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 strategy if you know what to do (learn more here).
Keeping this in mind, it's important to analyze the newest info surrounding Mag Silver Corp (USA) (NYSEAMEX:MVG).
Hedge fund activity in Mag Silver Corp (USA) (NYSEAMEX:MVG)
At Q2's end, a total of 8 of the hedge funds we track held long positions in this stock, a change of 0% from one quarter earlier. With the smart money's sentiment swirling, there exists an "upper tier" of key hedge fund managers who were increasing their holdings substantially.
When using filings from the hedgies we track, Sprott Asset Management, managed by Eric Sprott, holds the largest position in Mag Silver Corp (USA) (NYSEAMEX:MVG). Sprott Asset Management has a $15.6 million position in the stock, comprising 2.1% of its 13F portfolio. Coming in second is Peter Franklin Palmedo of Sun Valley Gold, with a $5.8 million position; 0.8% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish include Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk's GRT Capital Partners, D. E. Shaw's D E Shaw and Chuck Royce's Royce & Associates.
What do corporate executives and insiders think about Mag Silver Corp (USA) (NYSEAMEX:MVG)?
Legal insider trading, particularly when it's bullish, is best served when the company in question has experienced transactions within the past 180 days. Over the latest six-month time period, Mag Silver Corp (USA) (NYSEAMEX:MVG) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We'll also examine the relationship between both of these indicators in other stocks similar to Mag Silver Corp (USA) (NYSEAMEX:MVG). These stocks are First Majestic Silver Corp (NYSE:AG), Hecla Mining Company (NYSE:HL), Silver Standard Resources Inc. (USA) (NASDAQ:SSRI), Silvercorp Metals Inc. (USA) (NYSE:SVM), and Endeavour Silver Corp. (CAN) (NYSE:EXK). This group of stocks belong to the silver industry and their market caps are similar to MVG's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
First Majestic Silver Corp (NYSE:AG)
Hecla Mining Company (NYSE:HL)
Silver Standard Resources Inc. (USA) (NASDAQ:SSRI)
Silvercorp Metals Inc. (USA) (NYSE:SVM)
Endeavour Silver Corp. (CAN) (NYSE:EXK)
Using the returns explained by Insider Monkey's strategies, average investors should always pay attention to hedge fund and insider trading activity, and Mag Silver Corp (USA) (NYSEAMEX:MVG) shareholders fit into this picture quite nicely.