Bretton Capital Management, an investment management company, released the “Bretton Fund” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Bretton Fund returned 1.44% in Q4 2025 compared to 2.66% for the S&P 500 Index. In 2025, the Fund returned 11.58% compared to 17.88% for the Index. Although the market fluctuates daily between excitement and concern regarding a potential bubble in artificial intelligence, the firm views the overall market as not in bubble territory at this stage but is modestly elevated. Given the Fund’s long-term perspective, it is acceptable to reduce more speculative elements of the AI boom, which might resemble a bubble, even if this leads to a temporary lag during strong market phases. The Fund is focusing on areas of value that will provide good returns over the long term. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Bretton Fund highlighted stocks like Alphabet Inc. (NASDAQ:GOOG). Alphabet Inc. (NASDAQ:GOOG), the parent company of Google, offers various platforms and services, including online search and advertising, cloud solutions, and artificial intelligence, and is a significant contributor to the fund’s performance in the quarter. On March 04, 2026, Alphabet Inc. (NASDAQ:GOOG) stock closed at $303.45 per share with a market capitalization of $3.67 trillion. One-month return of Alphabet Inc. (NASDAQ:GOOG) was -8.41%, and its shares gained 74.19% of their value over the last 52 weeks.
Bretton Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOG) in its fourth quarter 2025 investor letter:
“Alphabet Inc.’s (NASDAQ:GOOG) stock continued its surge in the fourth quarter when it released its latest version of its AI chatbot Gemini. Unlike its clumsy earlier attempts, Gemini exceeded expectations and was on par with leading AI models.
Google had quite the year. At the stock’s nadir in April, it traded hands at a bit under $143. ChatGPT was going to replace Google, the Department of Justice was going to dismantle its search business, and Google was going to go the way of AltaVista. By the end of the year, the stock had more than doubled from that low point to $314, adding two trillion dollars of market capitalization. We didn’t have a crystal ball, but we knew that Google had so many attractive assets—the world’s best computing infrastructure, more search and internet data than anyone else, the largest video platform in YouTube, the most advanced self-driving platform, and much more—that it was likely worth more than the market was giving it credit for in April. We don’t expect the stock to double again in 2026, but we like where the company is headed.
Alphabet was the headliner for the fund this year, returning 65%, more than doubling from its mid-year lows. Contrary to expectations, clicks on their search ads have accelerated since the release of ChatGPT, and Google has found more ways to make more money from their unmatched assets. While the stock is no longer as dirt cheap as it was last year, we think at least three of their other main businesses—YouTube, Google Cloud and Waymo—are still in the early stages of being monetized. Earnings per share increased 34%.”
Alphabet Inc. (NASDAQ:GOOG) is in the 7th position on our list of 40 Most Popular Stocks Among Hedge Funds. As per our database, 203 hedge fund portfolios held Alphabet Inc. (NASDAQ:GOOG) at the end of the fourth quarter which was 186 in the previous quarter. In 2025, Alphabet Inc. (NASDAQ: GOOG) achieved its first-ever $400 billion annual revenue. While we acknowledge the risk and potential of Alphabet Inc. (NASDAQ:GOOG) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Alphabet Inc. (NASDAQ:GOOG) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Alphabet Inc. (NASDAQ:GOOG) and shared a list of best WallStreet bets stocks to buy according to analysts. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
