In this article, we will list the 5 best stocks to invest in according to Billionaire Steve Cohen. Please visit 10 Best Stocks to Invest In According to Billionaire Steve Cohen if you would like to see the extended list and the methodology behind it.
Steven Cohen of Point72 Asset Management
5. Arista Networks, Inc. (NYSE:ANET)
Point72 Asset Management’s Stake: $991 Million
Arista Networks, Inc. (NYSE:ANET) is a relatively recent addition to the 13F portfolio of Point72 Asset Management. The fund first disclosed a stake in the company back in the fourth quarter of 2024. This position comprised 3 million shares. By the second quarter of 2025, this had grown to nearly 7 million shares. After trimming the holding by 20% in the third quarter of 2025, the hedge fund added 37% to it in the fourth quarter of 2025. At the end of last year, the fund owned nearly 7.6 million shares in the networking company.
The most significant driver for institutional buying of Arista Networks, Inc. (NYSE:ANET) stock is the industry-wide move toward open-source Ethernet for backend AI networking. Historically, NVIDIA’s proprietary InfiniBand was the only choice for connecting GPUs. However, hedge funds are betting that hyperscalers like Meta, Microsoft, and Google are switching to Arista’s high-speed Ethernet to avoid vendor lock-in and lower their total cost of ownership. With the launch of the 7800R4 series, Arista has proven that Ethernet can now match InfiniBand’s low latency while supporting clusters of over 100,000 GPUs. As AI data centers hit power and heat limits, Arista is also winning contracts through superior hardware engineering. The firm introduced XPO Liquid-Cooled Optics in March 2026. This module addresses the extreme heat generated by 800G and 1.6T networking.
4. Microsoft Corporation (NASDAQ:MSFT)
Point72 Asset Management’s Stake: $1 Billion
Steve Cohen has held a long-term bullish view on Microsoft Corporation (NASDAQ:MSFT). This is reflected in the 13F filings as well. The tech giant has featured in the 13F portfolio of the fund since the second quarter of 2015. Back then, this position comprised just 4,000 shares. In the next quarter, the holding jumped to 2.1 million shares. The share ownership then stayed under the 2 million mark till early 2024, barring one exception. In the third quarter of 2025, the fund owned 2.6 million shares in the company. However, filings for the fourth quarter of 2025 reveal that this holding has been trimmed by 20% and the fund now owns 2 million shares of Microsoft.
Microsoft Corporation (NASDAQ:MSFT) is one of the favorite stocks among elite hedge funds. One catalyst for this interest is the Microsoft 365 Copilot transition into Agentic AI, where software does not just answer questions but performs complex, multi-step tasks, like automated procurement or project management. In late 2025/early 2026, Microsoft inked landmark deals with Cognizant, Infosys, and Wipro to deploy 50,000+ Copilot licenses. Hedge funds view these massive enterprise rollouts as the blueprint for global adoption. Another long-term driver for the shares is the move by the tech giant to control its own hardware costs. Microsoft is rolling out its custom Maia AI chips within Azure. Hedge funds believe this will significantly improve inference economics, reducing Microsoft’s reliance on expensive NVIDIA hardware and protecting cloud margins even as capital expenditure surges.
3. Amazon.com, Inc. (NASDAQ:AMZN)
Point72 Asset Management’s Stake: $1.2 Billion
Amazon.com, Inc. (NASDAQ:AMZN) has consistently featured in the 13F portfolio of Point72 Asset Management for more than a decade. The fund first disclosed a stake in the company back in the third quarter of 2014. This position comprised 2 million shares. By the second quarter of 2016, the fund had increased this to over 13 million shares. A cool-off period followed, during which Cohen trimmed this stake and brought it under 5 million shares. Latest filings, submitted at the end of the fourth quarter of 2025, show that the fund owned 5.2 million shares in the company, up 68% compared to filings for the previous quarter.
Amazon.com, Inc. (NASDAQ:AMZN) is turning heads on Wall Street not just because of AI but the growth inflection at Amazon Web Services, which has returned to its fastest growth rates since 2022. In early 2026, AWS reported that virtually all new capacity added is immediately purchased by customers. As of Q1 2026, Amazon’s cloud backlog has reached a staggering $200 billion. This massive committed revenue provides a safety net that few other tech giants can match. Hedge funds are also rewarding Amazon for its Trainium3 and Graviton5 chips. These custom processors allow AWS to offer AI training at a significantly lower cost than competitors reliant solely on third-party hardware, protecting long-term margins.
2. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Point72 Asset Management’s Stake: $1.4 Billion
Even though Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) first appeared in the 13F portfolio of Point72 Asset Management back in 2015, it has not been a consistent feature in the historical portfolio of the fund. 2021 onwards, however, the chip stock has appeared in the holdings constantly. Latest filings, submitted at the end of the fourth quarter of 2025, show that the fund owned 4.6 million shares in the company, up 157% compared to filings for the third quarter of 2025. Previously, the largest stake in the firm by the fund consisted of almost 2.5 million shares, disclosed in the fourth quarter of 2024.
Hedge funds love Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) stock for a variety of reasons. The single most significant catalyst for institutional buying in early 2026 was the official launch of mass production for 2-nanometer chips in January. TSMC is the first in the world to achieve high-volume manufacturing with Gate-All-Around (GAA) transistors at the 2nm node. Hedge funds are focused on the fact that over 50% of 2nm capacity through 2027 has already been pre-ordered by Apple, NVIDIA, and AMD. Wafers for the 2nm node are reportedly priced at $30,000, a 20% premium over the 3nm generation, ensuring massive margin expansion for the company.
1. NVIDIA Corporation (NASDAQ:NVDA)
Point72 Asset Management’s Stake: $1.9 Billion
NVIDIA Corporation (NASDAQ:NVDA) first appeared in the 13F portfolio of Point72 Asset Management back in the second quarter of 2015. This position comprised 2 million shares. By the fourth quarter of 2015, this stake had jumped to ownership of 66 million shares. Thereafter, Cohen reduced exposure to the stock, even selling it off completely but opening a new position within a few months. The present holding was purchased back in the first quarter of 2023 and consisted of 9.8 million shares then. Latest filings, submitted at the end of the fourth quarter of 2025, show that the fund owned nearly 10 million shares in the company, up 38% compared to filings for the previous quarter.
NVIDIA Corporation (NASDAQ:NVDA) remains the single most important barometer for hedge fund confidence in the AI supercycle. The company recently raised its lifetime sales projection for its major chip systems, Blackwell and the upcoming Vera Rubin, to $1 trillion through 2027, up from a previous estimate of $500 billion. Hedge funds are front-running the 2026–2027 rollout of the Vera Rubin architecture, which promises a 35x increase in throughput per megawatt. This efficiency is critical as data centers hit physical power constraints. Hedge funds are also shifting their focus from AI training to AI inference, where NVIDIA is extending its moat. NVIDIA’s partnership with Groq to deliver 1,500+ tokens per second is a major draw.
While we acknowledge the potential of NVDA to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than NVDA and that has 100x upside potential, check out our report about the cheapest AI stock.
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