Alger, an investment management firm, published its ‘Alger Spectra Fund’ fourth quarter 2020 investor letter – a copy of which can be downloaded here. In the letter, the fund highlighted their largest portfolio sector weightings, which is in Information Technology and Consumer Discretionary sector, with their comments on notable companies. The Communication Services sector together with the Industrial sector is where they achieved the largest chunk of their returns. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Alger Spectra Fund, in their Q4 2020 investor letter, mentioned Alibaba Group Holding Limited (NYSE: BABA) and emphasized their views on the company. Alibaba Group Holding Limited is a China-based e-commerce company that currently has a $627.7 billion market capitalization. Since the beginning of the year, BABA delivered a -1.05% return, but its 12-month gains are still up by 28.76%. As of March 15, 2021, the stock closed at $230.28 per share.
Here is what Alger Spectra Fund has to say about Alibaba Group Holding Limited in their Q4 2020 investor letter:
“Alibaba is the dominant e-commerce platform in the Chinese economy where e-commerce remains underpenetrated and fast growing. It is also a leading player in China’s cloud computing, big data analytics, digital media and entertainment markets. We own the shares because of the large addressable market opportunities in e-commerce and cloud computing, as well as Alibaba’s potential for exploit those opportunities due to state enacted barriers that block meaningful foreign competitors. Unfortunately, during the quarter, the Chinese Communist Party exhibited increased regulatory oversight of Alibaba, which precluded the company from consummating a value-creating IPO of ANT Financial, its formidable fintech platform. As a result of this near-term regulatory uncertainty, the shares detracted from portfolio performance.”
Our calculations show that Alibaba Group Holding Limited (NYSE: BABA) ranks 7th in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Alibaba Group Holding Limited was in 156 hedge fund portfolios, compared to 166 funds in the third quarter. BABA delivered a -10.06% return in the past 3 months.
The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.
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