In Atlas Advisors' MergerArb model, manager Jonathan Tunney looks for U.S. companies that could be the focus of a takeover. He then looks at their liquidity, share price and other factors to determine whether or not to invest. This week Tunney bought Hewitt Associates Inc (NYSE:HEW) a human resources consulting and outsourcing company. On July 12th, Hewitt signed an agreement to merge with a subsidiary of Aon Corporation (NYSE: AON). Over the past three years, HEW has shown increasing net income and increased their stockholder equity in 2009. News of the merger brought the stock up raising its closing price from $35.40 on July 9th to $46.79 on July 12th.
Mosaic Financial, manager of the Strategic Asset Allocation model, holds a mix of asset classes from equities, fixed income and alternative strategies. Boone added iShares MSCI EAFE Value Index Fund (EFV) to his model this week. This ETF was designed to mirror the performance of the MSCI EAFE Value index. As of this writing, the fund is trading within a few cents of NAV. The MSCI EAFE Value Index consists of the indices of 22 developed countries including France, Sweden and the UK.
We’ve talked about William Sosa’s Sector-Specific Momentum model here before. This week, Sosa bought Citigroup Inc (NYSE:C). Sosa uses a proprietary system to determine what to buy and looks for sector momentum. While the positions in the financial sector are still generally trading lower than they were earlier this year, the month of July brought in some positive momentum and C has experienced a decisive uptick.