Baron Capital, an investment Management Company, released its fourth quarter 2025 investor letter for its “Baron Opportunity Fund”. A copy of the letter can be downloaded here. The Fund returned 4.63% (Institutional Shares) in Q4 2025, outperforming the Russell 3000 Growth Index’s (the Benchmark) 1.14% gain and the S&P 500 Index’s 2.66% return. The Fund appreciated 19.73% for the full year, surpassing the benchmark’s 18.15% and the S&P’s 17.88% returns. A turbulent year ended with moderate improvements in the fourth quarter. Moderating tariff impacts, robust corporate earnings, and continued monetary easing supported fourth-quarter gains. The Fund management focuses on prioritizing significant secular growth trends, including AI, space exploration and technology, autonomous transportation, robotics, digital commerce, media, finance, advanced therapeutics, and minimally invasive surgery that disrupt businesses and create long-term profitable growth opportunities. This focus led to the Fund’s outperformance in the year. In addition, please check the Fund’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Baron Opportunity Fund highlighted stocks like The Trade Desk, Inc. (NASDAQ:TTD). The Trade Desk, Inc. (NASDAQ:TTD) is a leading technology company that specializes in digital advertising campaigns. On March 17, 2026, The Trade Desk, Inc. (NASDAQ:TTD) stock closed at $25.07 per share. One-month return of The Trade Desk, Inc. (NASDAQ:TTD) was -1.69%, and its shares lost 54.68% over the past 52 weeks. The Trade Desk, Inc. (NASDAQ:TTD) has a market capitalization of $11.933 billion.
Baron Opportunity Fund stated the following regarding The Trade Desk, Inc. (NASDAQ:TTD) in its fourth quarter 2025 investor letter:
“We decided to exit our long-term investment in The Trade Desk, Inc. (NASDAQ:TTD), predominantly due to mounting competitive pressures from Amazon’s aggressive ad-tech push. While we do not believe Amazon has yet captured meaningful market share, our industry checks suggested that more agencies and media buyers are inclined to try and expand budgets with Amazon in 2026, which is leveraging exclusive Prime Video and Netflix inventory and offering significantly lower take rates. This situation was further exacerbated by substantial executive turnover. Given these challenges, combined with less consistency in recent results, we found the risk/rewarded balance to be unfavorable and chose to sell our position. Given the company’s and CEO Jeff Green’s prior track record, we continue to research and analyze the company and reserve the right to revisit an investment in Trade Desk.”
The Trade Desk, Inc. (NASDAQ:TTD) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 60 hedge fund portfolios held The Trade Desk, Inc. (NASDAQ:TTD) at the end of the fourth quarter, up from 42 in the previous quarter. While we acknowledge the risk and potential of The Trade Desk, Inc. (NASDAQ:TTD) 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 The Trade Desk, Inc. (NASDAQ:TTD) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered The Trade Desk, Inc. (NASDAQ:TTD) and shared a list of best low-priced AI stocks to buy. 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.
