Tesla Motors Inc (NASDAQ:TSLA) investors should pay attention to an increase in activity from the world’s largest hedge funds recently.TSLA was in 29 hedge funds’ portfolio at the end of the third quarter of 2013. There were 25 hedge funds in our database with TSLA holdings at the end of the previous quarter.
According to most shareholders, hedge funds are assumed to be slow, outdated investment vehicles of years past. While there are over 8000 funds trading today, we at Insider Monkey choose to focus on the masters of this club, close to 450 funds. Most estimates calculate that this group controls the lion’s share of the smart money’s total asset base, and by watching their highest performing investments, we have figured out a few investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy beat 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 outperformed the S&P 500 index by 33 percentage points in 11 months (see all of our picks from August).
Just as integral, positive insider trading activity is another way to break down the investments you’re interested in. Just as you’d expect, there are many stimuli for a bullish insider to downsize shares of his or her company, but just one, very simple reason why they would behave bullishly. Many empirical studies have demonstrated the impressive potential of this tactic if piggybackers understand what to do (learn more here).
Now, we’re going to take a look at the latest action encompassing Tesla Motors Inc (NASDAQ:TSLA).
How have hedgies been trading Tesla Motors Inc (NASDAQ:TSLA)?
In preparation for this quarter, a total of 29 of the hedge funds we track held long positions in this stock, a change of 16% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their holdings significantly.
Of the funds we track, Ken Griffin’s Citadel Investment Group had the largest call position in Tesla Motors Inc (NASDAQ:TSLA), worth close to $223.1 million, comprising 0.3% of its total 13F portfolio. Coming in second is D. E. Shaw of D E Shaw, with a $161.4 million call position; 0.3% of its 13F portfolio is allocated to the company. Some other hedgies with similar optimism include Philippe Laffont’s Coatue Management, John Griffin’s Blue Ridge Capital and Daniel Benton’s Andor Capital Management.
As aggregate interest increased, specific money managers have jumped into Tesla Motors Inc (NASDAQ:TSLA) headfirst. Blue Ridge Capital, managed by John Griffin, assembled the most valuable position in Tesla Motors Inc (NASDAQ:TSLA). Blue Ridge Capital had 96.7 million invested in the company at the end of the quarter. Mike Masters’s Masters Capital Management also initiated a $20.9 million position during the quarter. The other funds with brand new TSLA positions are James Dondero’s Highland Capital Management, David Costen Haley’s HBK Investments, and Peter Muller’s PDT Partners.
What do corporate executives and insiders think about Tesla Motors Inc (NASDAQ:TSLA)?
Insider buying is at its handiest when the company in question has seen transactions within the past 180 days. Over the last six-month time period, Tesla Motors Inc (NASDAQ:TSLA) has experienced 1 unique insiders buying, and 6 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Tesla Motors Inc (NASDAQ:TSLA). These stocks are Honda Motor Co Ltd (ADR) (NYSE:HMC), Ford Motor Company (NYSE:F), Nissan Motor Co., Ltd. (ADR) (PINK:NSANY), General Motors Company (NYSE:GM), and Tata Motors Limited (ADR) (NYSE:TTM). This group of stocks are in the auto manufacturers – major industry and their market caps match TSLA’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Honda Motor Co Ltd (ADR) (NYSE:HMC)||12||0||0|
|Ford Motor Company (NYSE:F)||57||1||15|
|Nissan Motor Co., Ltd. (ADR) (PINK:NSANY)||1||0||0|
|General Motors Company (NYSE:GM)||140||0||2|
|Tata Motors Limited (ADR) (NYSE:TTM)||21||0||0|
With the returns exhibited by Insider Monkey’s studies, everyday investors must always watch hedge fund and insider trading sentiment, and Tesla Motors Inc (NASDAQ:TSLA) shareholders fit into this picture quite nicely.
This article is produced by hedge fund tracking site Insider Monkey.