5 Stocks to Buy Amid Rising Interest Rates

2. Citigroup Inc. (NYSE:C)

Number of Hedge Fund Holders: 79  

Citigroup Inc. (NYSE:C) is a diversified financial services holding firm. It is based in New York and has featured among the top hedge fund stocks for years. At the end of the third quarter of 2021, 79 hedge funds in the database of Insider Monkey held stakes worth $5.5 billion in Citigroup Inc. (NYSE:C), compared to 87 the preceding quarter worth $6.1 billion.

Just as an interest rate hike signals a boom for the finance sector, Citigroup Inc. (NYSE:C) has been selling overseas assets in Mexico and Taiwan as part of a larger plan to prioritize positive investor returns. The market has reacted positively to the shedding of global operations, which is driving a recalibration in corporate structure at the firm as well. 

In its Q1 2021 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Citigroup Inc. (NYSE:C)  was one of them. Here is what the fund said:

“We fully exited position in Citigroup. Global financial services company Citigroup made a $900 million clerical error and received a public reprimand from federal regulators. This, after a decade focused on process control, information technology and risk systems, makes the error substantially more costly than just the $900 million mistake. Regulators believe the company’s risk management improvements have fallen short of expectations. To rectify the situation, a process and technology spending surge could negatively affect 2021-2022 profits by 10% to 20%. Trust and confidence are important in large financial institutions, and this incident combined with the CEO’s sudden retirement shook ours.”