"Smart money" investors like institutions and company insiders get this complimentary name because they're in special positions of information power.
Institutional investors have access to sophisticated research, while company insiders know more about their companies than any other investors. When these groups of investors buy a stock, it's a signal to take a second look.
It also helps to add a dimension of technical analysis to this method. For instance, stocks rallying above their recent moving averages may have the momentum to push even higher. Technical momentum, coupled with smart money buying interest, can be an interesting trade.
Investment ideas
We ran a screen to utilize the buying trends of these smart money investors. We first screened for stocks rallying above their 20-day, 50-day, and 200-day moving averages.
We then screened for those with buying attention from the smart money, seeing significant net buying from institutional investors over the current quarter and from company insiders over the last six months.
Do you agree with the bullish sentiment coming from these smart money investors?
List sorted alphabetically. (Click here to access free, interactive tools to analyze these ideas.)
1. Conns (Nasdaq: CONN ) : Operates as a specialty retailer of home appliances, consumer electronics, home office equipment, lawn and garden products, mattresses, and furniture in the United States. Stock is currently trading 14.61% above its 20-day SMA, 28.36% above its 50-day SMA, and 56.23% above its 200-day SMA. Net institutional purchases in the current quarter at 546.1K shares, which represents about 3.76% of the company's float of 14.52M shares. Over the last six months, insiders were net buyers of 20,000 shares, which represents about 0.14% of the company's 14.52M share float.
2. Citizens Republic Bancorp (Nasdaq: CRBC ) : Operates as the bank holding company for Citizens Bank that provides banking and financial services to individuals and businesses in Michigan, Wisconsin, Ohio, and Indiana. Stock is currently trading 18.09% above its 20-day SMA, 28.79% above its 50-day SMA, and 26.88% above its 200-day SMA. Net institutional purchases in the current quarter at 2.5M shares, which represents about 7.36% of the company's float of 33.95M shares. Over the last six months, insiders were net buyers of 118,000 shares, which represents about 0.35% of the company's 33.95M share float.
3. Lions Gate Entertainment (NYSE: LGF ) : Engages in the motion picture production and distribution, television programming and syndication, home entertainment, family entertainment, new channel platforms, and digital distribution activities. Stock is currently trading 7.08% above its 20-day SMA, 14.53% above its 50-day SMA, and 26.15% above its 200-day SMA. Net institutional purchases in the current quarter at 36.9M shares, which represents about 69.61% of the company's float of 53.01M shares. Over the last six months, insiders were net buyers of 919,823 shares, which represents about 1.74% of the company's 53.01M share float.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Alexander Crawford does not own any of the shares mentioned above. Insider data sourced from Yahoo! Finance, institutional data sourced from Fidelity, all other data sourced from Finviz.
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