Investing is a space where the barriers to entry are low, anyone with money to spare or access to capital can enter it, but the competition is perhaps more intense than any other industry. That’s because it’s a zero-sum game – for someone who makes money, there is someone else on the other side of the trade who loses it. Those fund managers who are able to achieve mastery in this game not only make a fortune for their investors, but also end up becoming billionaires themselves. At Insider Monkey we pay special emphasis on the moves made by funds led or founded by billionaire investors because their stock picks have historically performed better than the rest of the crowd. In this post, we will take a look at the top five stocks held by the 58 billionaire investors in our database discuss the changes in their popularity among billionaire investors during the first quarter.
Through extensive research, we determined that imitating some of the picks of hedge funds and other institutional investors can help generate market-beating returns over the long run. The key is to focus on the small-cap picks of these investors, since they are usually less followed by the broader market and are less price-efficient. Our backtests that covered the period between 1999 and 2012, showed that following the 15 most popular small-caps among hedge funds can help a retail investor beat the market by an average of 95 basis points per month (see more details here).
#5 Apple Inc. (NASDAQ:AAPL)
– Billionaires with long positions (as of March 31): 18
– Aggregate value of billionaires’ holdings (as of March 31): $5.73 billion
Let’s start with Apple Inc. (NASDAQ:AAPL), which saw its ownership among billionaire investors covered by us inch up by one during the first quarter. Despite that rise in the number of funds with long positions, the aggregate value of billionaires’ holdings in the company fell during that period by 45.7%. Billionaires’ firms that reduced their stakes in the company significantly during the first quarter included Chase Coleman‘s Tiger Global Management LLC, which reduced its holding in the company by 47% to 5.65 million shares. After plummeting after the company’s fiscal second quarter earnings release, shares of Apple Inc. (NASDAQ:AAPL) have seen a rally in the past three weeks, but have so far failed to trade convincingly above the $100 mark. Investors are eagerly waiting for the company’s annual Worldwide Developers Conference, which is scheduled to begin on June 13th, for catalysts that can drive the stock higher in the short-term. On May 31, Nikkei Asian Review reported that the company is planning to stretch the lifecycle of iPhones to three years from current two-year period.