By The Sizemore Letter<\/u><\/p>\n
I love peeking over the shoulder of successful investors.\u00a0 It\u2019s not so much a matter of seeing what they are buying and selling as much as it\u2019s seeing what they are thinking<\/i>.\u00a0\u00a0 You\u2019re always at an information disadvantage when you watch the trades of hedge fund guru; you\u2019ll never know exactly why they placed the trades they did or what their expected returns or time horizon are.\u00a0 But you can get a pretty good idea of what their overriding investment themes are.<\/p>\n
You can follow these trades by reading the publically-available 13F filings they are required to report to the SEC.\u00a0 Or, you can use one of many services that compile and crunch this data for you.<\/p>\n
Today, I want to draw your attention to a \u201cguru heat map\u201d produced by Guru Focus: See Guru Buys<\/a><\/strong> and Guru Sells<\/a><\/strong>. \u00a0These heat maps aggregate all insider buying and selling of S&P 500 stocks and rank them accordingly.<\/p>\n A few things jump right off the page.\u00a0 Microsoft<\/strong> (<\/span>MSFT<\/a>)<\/span> has become a battleground stock among gurus; it is the most aggressively sold by gurus, but is also in the top 20 of top buys.\u00a0 Apple<\/strong> (<\/span>AAPL<\/a>)<\/span>, Google<\/strong> (<\/span>GOOG<\/a>)<\/span>, Qualcomm<\/strong> (<\/span>QCOM<\/a>)<\/span>, Cisco Systems<\/strong> (<\/span>CSCO<\/a>)<\/span>, Berkshire Hathaway<\/strong> (<\/span>BRK-B<\/a>)<\/span>, Wells Fargo<\/strong> (<\/span>WFC<\/a>)<\/span> and CitiGroup<\/strong> (<\/span>C<\/a>)<\/span> also feature prominently in both lists.\u00a0 It\u2019s hard to draw conclusions when rock star investors are simultaneously buying and dumping the shares.<\/p>\n Not all stocks had ambiguous guru activity, howver.\u00a0 Oracle<\/strong> (<\/span>ORCL<\/a>)<\/span> was the most heavily bought stock by gurus, with 16 individual gurus identified by Guru focus, and it was not in the top 50 of those sold.<\/p>\n A less common name being accumulated by gurus is Cabot Oil and Gas<\/strong> (<\/span>COG<\/a>)<\/span>, which had 7 recent guru buyers and no major selling.<\/p>\n While I don\u2019t recommend you run out and buy or sell a stock based on its guru buying patterns, I recommend you periodically visit the guru heat maps.\u00a0 Tools like this can be a useful starting point in your investment process. \u00a0When entering a trade, it’s nice to know whose in it with you…or who might be taking the other side.<\/p>\n Charles Lewis Sizemore, CFA, is the editor of the\u00a0Sizemore Investment Letter<\/a>\u00a0and the chief investment officer of investments firm Sizemore Capital Management. As of this writing, he was long MSFT and CSCO.\u00a0Click here<\/a>\u00a0to learn about his top 5 global investing trends and get your copy of \u201cThe Top 5 Million Dollar Trends of 2013.\u201d \u00a0This article first appeared on TraderPlanet<\/a>.<\/em><\/p>\n <\/p>\n This article first appeared on Sizemore Insights as When Gurus Clash: Using Guru Trading Data<\/a><\/p>\n