Meridian Funds, managed by ArrowMark Partners, released its “Meridian Enhanced Equity Fund” second quarter 2022 investor letter. A copy of the same can be downloaded here. In the second quarter, the fund returned -12.74% net, outperforming its benchmark, the S&P 500 Index, which fell by -16.10%. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.
Meridian Funds discussed stocks like Coty Inc. (NYSE:COTY) in the second quarter investor letter. Based in New York, New York, Coty Inc. (NYSE:COTY) is into beauty products business. On September 14, 2022, Coty Inc. (NYSE:COTY) stock closed at $7.84 per share. One-month return of Coty Inc. (NYSE:COTY) was 0.26% and its shares lost 5.66% of their value over the last 52 weeks. Coty Inc. (NYSE:COTY) has a market capitalization of $6.579 billion.
Here is what Meridian Funds specifically said about Coty Inc. (NYSE:COTY) in its Q2 2022 investor letter:
“Similarly, Coty Inc. (NYSE:COTY) benefited from the market’s rising appetite for more defensive names during the quarter. The beauty products Coty manufactures and distributes saw steady market share gains, especially as core customers expanded their work and leisure activities outside of the home. The company also operates a broad distribution network and holds a deep intellectual property portfolio across key categories within the cosmetic and fragrance industries. Additionally, Coty is building momentum around a business transformation that’s in the early innings but has already seen success in e-commerce and direct-to-consumer gains, as well as a rising presence in China.”
Coty Inc. (NYSE:COTY) is not on the list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 29 hedge fund portfolios held Coty Inc. (NYSE:COTY) at the end of the second quarter which was 30 in the previous quarter.
We discussed Coty Inc. (NYSE:COTY) in another article and shared the list of stocks that the Russia-Ukraine war is crushing. In addition, please check out our hedge fund investor letters Q2 2022 page for more investor letters from hedge funds and other leading investors.
Disclosure: None. This article is originally published at Insider Monkey.
Interactive Strength Inc. (NASDAQ:TRNR – d/b/a/”FORME”) operates a digital fitness platform that combines premium connected award-winning fitness hardware products with 1:1 personal training and coaching (from real humans) to deliver an immersive experience and better outcomes for both consumers and trainers. Management believes that TRNR is the pioneer brand in the emerging sector of virtual personal training and health coaching. Moreover, this approach accelerates a powerful shift towards outcome-driven fitness solutions. It is part of a growing group of emerging companies that seek to leverage the Internet to provide users with a gym like experience within the comfort of their homes, however TRNR is differentiated with a virtual personal training offering and business model that capitalizes on time-zone efficiency. The Company recently announced the signing of an LOI to acquire a profitable, growing connected fitness business, which could dramatically changes outlook, revenue, profitability, and valuation for TRNR. The acquisition expected to close by the fourth quarter of 2023.
Warren Buffett never mentions this but he is one of the first hedge fund managers who unlocked the secrets of successful stock market investing. He launched his hedge fund in 1956 with $105,100 in seed capital. Back then they weren’t called hedge funds, they were called “partnerships”. Warren Buffett took 25% of all returns in excess of 6 percent.
For example S&P 500 Index returned 43.4% in 1958. If Warren Buffett’s hedge fund didn’t generate any outperformance (i.e. secretly invested like a closet index fund), Warren Buffett would have pocketed a quarter of the 37.4% excess return. That would have been 9.35% in hedge fund “fees”.
Actually Warren Buffett failed to beat the S&P 500 Index in 1958, returned only 40.9% and pocketed 8.7 percentage of it as “fees”. His investors didn’t mind that he underperformed the market in 1958 because he beat the market by a large margin in 1957. That year Buffett’s hedge fund returned 10.4% and Buffett took only 1.1 percentage points of that as “fees”. S&P 500 Index lost 10.8% in 1957, so Buffett’s investors actually thrilled to beat the market by 20.1 percentage points in 1957.
Between 1957 and 1966 Warren Buffett’s hedge fund returned 23.5% annually after deducting Warren Buffett’s 5.5 percentage point annual fees. S&P 500 Index generated an average annual compounded return of only 9.2% during the same 10-year period. An investor who invested $10,000 in Warren Buffett’s hedge fund at the beginning of 1957 saw his capital turn into $103,000 before fees and $64,100 after fees (this means Warren Buffett made more than $36,000 in fees from this investor).
As you can guess, Warren Buffett’s #1 wealth building strategy is to generate high returns in the 20% to 30% range.
We see several investors trying to strike it rich in options market by risking their entire savings. You can get rich by returning 20% per year and compounding that for several years. Warren Buffett has been investing and compounding for at least 65 years.
So, how did Warren Buffett manage to generate high returns and beat the market?
In a free sample issue of our monthly newsletter we analyzed Warren Buffett’s stock picks covering the 1999-2017 period and identified the best performing stocks in Warren Buffett’s portfolio. This is basically a recipe to generate better returns than Warren Buffett is achieving himself.
You can enter your email below to get our FREE report. In the same report you can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12-24 months. We initially share this idea in October 2018 and the stock already returned more than 150%. We still like this investment.
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