You may not have a slew of advanced analytic tools to evaluate stocks, and may not have the time or expertise to use them even if you did, but there is a way to tap into exactly that, and without spending a lot of time or money in the process. By keeping an eye open for indications of where smart-money investors are committing their funds, you are, in effect, taking advantage of all the tools, technologies, expertise, and effort that went into those decisions.
A recent article in The Motley Fool focused on “smart-money investors”, including institutional investors, such as hedge fund, mutual fund, and pension fund managers. They indicated that their team screened the financial sector for stocks with bullish sentiment from these investors. They first identified financial stocks with overall market bullishness, rallying above their 20-day, 50-day, and 200-day moving averages. They then zeroed in on the ones with “significant net institutional purchases” over the current quarter. The net result was an indication that smart-money investors are generally positive on these names.
Here are some of the stocks that they came up with, including BofI Holdings:
• Bridge Capital Holdings – This company operates as the bank holding company for Bridge Bank, National Association, which provides commercial and retail banking services to business professionals, retail customers, and small-sized and medium-sized commercial businesses in California. Its market cap is $227.07 million, with a most recent closing price of $14.87. The stock is currently trading 3.45% above its 20-day SMA, 10.51% above its 50-day SMA, and 32.59% above its 200-day SMA. Net institutional purchases in the current quarter total 1.5 million shares, which represent about 21.46% of the company’s float of 6.99 million shares.
• Symetra Financial Corporation – Symetra operates as a financial-services company in the life insurance industry in the U.S. Its market cap is $1.42 billion, with a most recent closing price of $11.99. The stock is currently trading 1.94% above its 20-day SMA, 5.32% above its 50-day SMA, and 21.21% above its 200-day SMA. Net institutional purchases in the current quarter total 16.1 million shares, which represent about 11.73% of the company’s float of 137.26 million shares.
• Monmouth Real Estate Investment (NYSE: MNR) – Monmouth is a real-estate investment trust. It owns, manages, and leases properties to investment-grade tenants on long-term leases. Its market cap is $412.06 million, with a most recent closing price of $10.30. The stock is currently trading 2.84% above its 20-day SMA, 6.49% above its 50-day SMA, and 19.71% above its 200-day SMA. Net institutional purchases in the current quarter total 2.8 million shares, which represent about 7.23% of the company’s float of 38.74 million shares.
• Equity One – This company engages in the ownership, management, acquisition, renovation, and development of neighborhood and community shopping centers in the U.S. Its market cap is $2.4 billion, with a most recent closing price of $20.75. The stock is currently trading 0.24% above its 20-day SMA, 3.73% above its 50-day SMA, and 17.74% above its 200-day SMA. Net institutional purchases in the current quarter total 4.8 million shares, which represent about 8.53% of the company’s float of 56.3 million shares.
• BofI Holding (NASDAQ: BOFI) – BofI operates as the holding company for Bank of Internet USA, which provides various consumer and wholesale banking services primarily through the Internet in the U.S. Its market cap is $215.57 million, with a most recent closing price of $18.98. The stock is currently trading 4.6% above its 20-day SMA, 8.48% above its 50-day SMA, and 19.75% above its 200-day SMA. Net institutional purchases in the current quarter total 1.2 million shares, which represent about 11.95% of the company’s float of 10.04 million shares.
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