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10 Most Popular Stocks Among Hedge Funds (Part 1)

In the presence of burgeoning market uncertainty and innumerable options, it becomes almost impossible for an average investor to decide where to invest in the stock market to reap sizable profits. In fact, even some top money managers are having trouble finding good stocks to invest in, which lead Longleaf Partners to close earlier this year.

That’s where the strategy of mimicking the gurus of the industry can prove valuable. Goldman Sachs recently revealed in a report that investors should pay attention to the $3 trillion hedge fund industry, as its top picks are crushing the market this year. Goldman strategist David Kostin wrote in the report issued to investors last week that the “proverbial” smart money should be followed, because hedge funds’ top picks have generated higher median year-to-date returns than the consensus most out-of-favor stocks.

In this article we’ll share the five most favored stocks among the 676 elite hedge funds that we track at Insider Monkey which filed 13Fs for the first quarter. That’s what we do at Insider Monkey and our flagship strategy has returned 44.2% since February 2016 vs. a 29.6% gain for the S&P 500 index ETF (SPY). Our most recent stock picks, which were disclosed to our subscribers in the middle of February, beat the market by 5 percentage points in the three months that followed and our latest picks were released in the middle of May. Our system is easy for investors to implement, with just a small batch of trades to be executed once per quarter. We are also offering a 14-day money-back guarantee on our premium newsletters, plus you can get $90 off by using this link, so don’t miss this chance to check out our latest picks risk-free and see if Insider Monkey’s simple and effective small-cap strategy would make a good addition to your portfolio.

Most Popular Stocks Among Hedge Funds

Taina Sohlman /

#5 Microsoft Corporation (NASDAQ:MSFT)

Microsoft kicks off our list, ranking as the fifth-most popular stock among hedge funds. As of the end of the first quarter, 121 hedge funds tracked by Insider Monkey reported owning $18.97 billion worth of Microsoft Corporation (NASDAQ:MSFT) shares, representing 3.70% of the company’s float.

Microsoft Corporation (NASDAQ:MSFT) has gained about 16% in value since the start of the year and is slowly stepping up its game in the search market. Last week, it launched the Bing rewards program in the UK, according to which the company will reward people for using its Bing search engine or Edge browser. Microsoft Corporation (NASDAQ:MSFT) could use LinkedIn’s massive user base of 500 million users to further monetize and expand its footprint. The company’s Azure Cloud platform is another strength, as Microsoft’s Cloud revenue in the first quarter increased by 93% year-over-year. Among the top shareholders of Microsoft is Boykin Curry’s Eagle Capital Management, which owned 25.72 million shares of the company as of the end of the first quarter.

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Head to the next page to see which company ranked as the fourth-most popular among hedge funds.

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