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DO YOU KNOW WHAT YOUR MUTUAL FUND MANAGER IS DOING?
 This
article is going to be rather short, but I hope it will inspire some of
you to check your mutual fund holdings. We are in the middle of a
research project, which has revealed a lot more than what we were
looking for when we initiated the project. We apply a series of screens
in order to arrive at the companies that fit the criteria we are looking
for. The first screen involves companies that experienced a net increase
in their institutional ownership over the past six months. Then we
examined if insiders increased their ownership stakes at
the same or higher rate as mutual fund managers did. If insiders are
buying, they must know something, and if mutual fund managers are
buying, it means the stock has institutional support. That's a winning
combination to start with. To our surprise we found out that in the
past six months as mutual fund managers increased feverishly their stake
in many companies, insiders decreased their stake at an even higher
rate! Our findings begs the question; who do you think knows more about
the company, the people who run it, or some over-educated with an
oversized ego, master of the universe wanna-be, like the
geniuses who run some of Fidelity and Janus funds?
I
will leave the answer up to you...
Check
out the data displayed in the table below. This is only a small sample
of what we discovered. The companies listed experienced an average
increase in institutional ownership by 4.61%. Why would someone
increase his stake in companies that on average sport a trailing
p/e of 55.17, a forward p/e of 33, and a sales to price ratio of
11? What is it that these geniuses see in these companies that the
people who manage them don't? There were 455 insider transactions in
these companies the last six months, 451 on the sell side!
Fidelity
and Janus are among the biggest institutional shareholders of all
these companies...
I
think I have said enough, and I strongly encourage you to find out what
your mutual fund manager is doing.
| STOCK |
INSIDER
PURCHASES |
INSIDER
SALES |
NET
INSIDER |
NET
INST'L |
% |
TRAILING |
FORWARD |
PRICE/
SALES |
| Symbol |
Shares# |
Trans# |
Shares# |
Trans# |
Pur/Sales |
Pur/Sales |
Inc/Dec |
P/E |
P/E |
P/S |
| AAPL |
0 |
0 |
4878000 |
53 |
(4878000) |
16081000 |
6.00% |
72.49 |
42.14 |
1.74 |
| ADI |
0 |
0 |
701000 |
44 |
(701000) |
12332000 |
3.80% |
40.98 |
20.42 |
7.26 |
| AMAT |
0 |
0 |
847000 |
4 |
(847000) |
40630000 |
3.30% |
72.27 |
15.12 |
5.28 |
| BIIB |
0 |
0 |
1595000 |
41 |
(1595000) |
15926000 |
5.30% |
0.00 |
33.55 |
18.00 |
| BRCM |
0 |
0 |
3120000 |
76 |
(3120000) |
15180000 |
7.60% |
0.00 |
28.78 |
7.19 |
| CSCO |
2000 |
1 |
1320000 |
9 |
(1318000) |
90238000 |
2.20% |
36.37 |
27.23 |
7.50 |
| DNA |
0 |
0 |
1350000 |
41 |
(1350000) |
33484000 |
6.80% |
91.61 |
52.00 |
16.40 |
| EBAY |
1000 |
1 |
4553000 |
44 |
(4552000) |
14110000 |
3.10% |
106.13 |
54.75 |
23.35 |
| INTC |
2000 |
2 |
1164000 |
7 |
(1162000) |
24561000 |
7.00% |
28.41 |
19.06 |
5.68 |
| KLAC |
0 |
0 |
229000 |
11 |
(229000) |
2683000 |
1.60% |
51.01 |
17.94 |
6.48 |
| MXIM |
0 |
0 |
251000 |
16 |
(251000) |
1591000 |
5.00% |
45.86 |
27.54 |
12.07 |
| QCOM |
0 |
0 |
1427000 |
55 |
(1427000) |
27247000 |
4.60% |
41.20 |
30.09 |
13.00 |
| XLNX |
0 |
0 |
933000 |
21 |
(933000) |
568000 |
0.20% |
38.27 |
21.95 |
8.07 |
| YHOO |
0 |
0 |
4188000 |
33 |
(4188000) |
91049000 |
8.00% |
147.79 |
71.27 |
20.77 |
| TOTALS |
5000 |
4 |
26556000 |
455 |
(26551000) |
385680000 |
|
| Ratio
Sales/Purchases |
113.75:1
|
|
AVERAGE |
4.61% |
55.17 |
32.99 |
10.91 |
| (Transactions) |
| Ratio
Sales/Purchases |
5311.20:1
|
|
| (Shares) |
Ike
Iossif
As of
6-22-04 we have no positions in either client, company, or personal
accounts in any of the following companies. Also, if you are interested
in a mutual fund manager who conducts himself with integrity and takes
his fiduciary responsibility seriously, then I highly recommend Dr.
Hussman and his two funds, Strategic Total Return Fund, and Strategic
Growth Fund, visit: http://hussman.net.
Please be advised that
we do have positions in both funds in client, company, and personal
accounts.
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