The $2.7 billion Valiant Capital is heavily weighted with technology stocks, and given that fund manager Christopher Hansen is an alum of Blue Ridge Capital, we can see that he didn’t change the philosophy of Blue Ridge when he started his fund. This seems to be a winning strategy for Valiant, at least in its equity portfolio—according to 13F filings from the SEC. More than 45% of the entire portfolio is in tech stocks, which hold the top four positions. The entire equity portfolio can be seen here.
Because it’s always important to track hedge fund activity—see how it has helped retail investors beat the S&P 500 handily—let’s take a look at the top five stock picks for Valiant Capital.
Topping the list is Apple Inc. (NASDAQ:AAPL) with just over 16% of the portfolio. The “iEverything” maker hasn’t had an easy time this year after Tim Cook took over for the late, tech-legend Steve Jobs. The company is facing very serious competition from Google’s Android, and a recent announcement by Facebook Inc (NASDAQ: FB) to use Android phones for its new Facebook Inc (NASDAQ: FB) user interface, Home, drove Apple Inc. (NASDAQ:AAPL) shares down by another 1%, bringing the total declination in Apple Inc. (NASDAQ:AAPL) since the start of the year to a whopping 22%.
And speaking of Facebook Inc (NASDAQ: FB) —number two in Valiant’s top five—investors were clearly excited by founder Mark Zuckerberg’s announcement regarding Home. The stock rallied 3% ahead of the 1:00pm announcement to a two-week high of $26.39. Although Facebook still hasn’t completely solved the problem of how to monetize its social-network dominance, the news was seen as a step in the right direction. Gains could be tempered, however, as analysts warn of increased teenage interest in Instagram, Tumblr and Pheed, draining interest in Facebook Inc (NASDAQ: FB), and ultimately, Home.
Number three is Google Inc (NASDAQ:GOOG). Although Facebook will be running its new app on Android phones (such as the Samsung Galaxy), the news wasn’t all rainbows and sunshine for Google Inc (NASDAQ:GOOG). There is some concern that Home will supplant the Android features of the phone, and could potentially draw users away from the platform toward a Facebook Inc (NASDAQ: FB)-exclusive functionality. Although Facebook will not immediately use its own search app, Graph Search, on Home, the prospect of it doing so in the future isn’t unrealistic and could be more damaging to Google Inc (NASDAQ:GOOG).
At number four of the top five is Liberty Global Inc. (NASDAQ:LBTYA), which provides video, broadband and telephone services to mostly Europe and Chile. The stock has been helped recently by the 12.6% acquisition in Holland’s Ziggo, and by an 8% increase in revenue for the 4Q of 2012, mostly on the company’s aggressive expansion in Europe. Since the start of 2013, Liberty Global Inc. (NASDAQ:LBTYA) has gained 17% and is breaking into a new trading range at $74.00 to $79.01.
Finally, at number five is Charles Schwab Corp (NYSE:SCHW), in which Valiant holds nearly 5 million shares. Since adding Charles Schwab Corp (NYSE:SCHW) to its equity portfolio during the second quarter of 2011, Valiant has increased their position by 78%. While traditional brokers have seen demand for their services decline dramatically with the onset of online trading, Charles Schwab Corp (NYSE:SCHW) shrewdly restructured itself as a savings and loan holding company, thereby giving it an asset-based income. This ensures the longevity of the company, and equally as important for shorter-term investors, helps to maintain a very bullish debt-to-equity ratio in comparison to other entities in this sector.
One reason Christopher Hansen may like the tech sector so much is because he grew up in Seattle, home to the grandfather of all tech companies, Microsoft Corporation (NASDAQ:MSFT). Or maybe he realizes that although many of the top picks in his portfolio may no longer be considered “diamonds in the rough,” they are still gems. From Apple Inc. (NASDAQ:AAPL) to Facebook Inc (NASDAQ: FB) and Google Inc (NASDAQ:GOOG), to Hansen’s investments in Liberty Global Inc. (NASDAQ:LBTYA) and Charles Schwab Corp (NYSE:SCHW), each member of this “fab five” represents a strong play, and it only means that investors should pay attention to his entire equity portfolio as well.
Disclosure: none
