Billionaire Ken Fisher‘s Fisher Asset Management is among the top funds tracked by Insider Monkey. At the end of the first quarter the fund held long positions in 421 stocks with a market capitalization of $1 billion or more. After collating data relating to these stocks, we found the weighted average returns of Fisher’s stock picks came out to 1.5% for the quarter. Year-to-date, Fisher Asset Management’s picks using the aforementioned criteria have returned 3.0%. It should be noted that these figures do not represent the actual returns of the fund, as they exclude bonds, options, and the returns of long positions in micro-cap companies. However, they give a glimpse at the performance of the bulk of Fisher’s long positions based on their composition on March 31. At the end of the second quarter, the fund had a public equity portfolio valued at $51.45 billion, up from $50.05 billion at the end of the first quarter. Besides the fund’s stock picking performance in the second quarter of 2015, this article also looks into some of its top stock picks going into the third quarter. These are Apple Inc. (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), and Pfizer Inc. (NYSE:PFE).
We pay attention to hedge funds’ moves because our research has shown that hedge funds are extremely talented at picking stocks on the long side of their portfolios. It is true that hedge fund investors have been underperforming the market in recent years. However, this was mainly because hedge funds’ short stock picks lost a ton of money during the bull market that started in March 2009. Hedge fund investors also paid an arm and a leg for the services that they received. We have been tracking the performance of hedge funds’ 15 most popular stock picks in real time since the end of August 2012. These stocks have returned 139% since then and outperformed the S&P 500 Index by around 81 percentage points (see the details here). That’s why we believe it is important to pay attention to hedge fund sentiment; we also don’t like paying huge fees.
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Keeping that in mind, let’s now look at the three stocks that are among Fisher Asset Management’s top picks heading into the third quarter of 2015. At the end of the second quarter of 2015, the fund held a total of 11.01 million shares of Apple Inc. (NASDAQ:AAPL) valued at $1.38 billion, representing 2.68% of its total portfolio holdings. Apple Inc is the world’s biggest company in terms of market capitalization, standing at a whopping $758 billion. The iPhone maker’s shares have jumped by close to 40% over the past year, which is indeed a huge feat for a company of its size. Apple Inc. (NASDAQ:AAPL) has already recorded $31.6 billion in profits this year, through just half the fiscal year. If the trend continues, the Cupertino, California-based company is likely to beat the highest fiscal year profit record of $45.5 billion set by Exxon Mobil Corporation (NYSE:XOM) in 2008. The company delivered 1.2% in equity gains during the second quarter. Going into the second quarter, a few of the hedge funds out of the ones we track that held positions in the stock were billionaire Carl Icahn‘s Icahn Capital LP with 52.76 million shares, Phill Gross and Robert Atchinson’s Adage Capital Management, and Philippe Laffont’s Coatue Management. A total of 150 hedge funds out of the more than 700 tracked by Insider Monkey were invested in the stock, with an aggregate investment value of $21.52 billion.
Fisher Asset Management held a total of 2.49 million shares of Amazon.com, Inc. (NASDAQ:AMZN) with a market value of $1.08 billion at the end of the second quarter of 2015. This was equivalent to 2.10% of its total portfolio holdings. Fisher and other investors who held positions in the stock were happy to receive 16.7% in equity gains during the second quarter of 2015. Forward looking, the Seattle, Washington-based company is focused on enhancing its profitability and is working on strengthening Amazon Prime, which is a service that charges $99 per year, allowing Prime members to stream videos, borrow books, enjoy free shipping for eligible purchases, and enjoy a host of other bonuses. RBC Capital estimates revealed that the loyalty membership program is already boasting between 50 and 70 million subscribers globally. The biggest shareholders of the stock going into the second quarter aside from Fisher were Boykin Curry‘s Eagle Capital Management with 2.23 million shares, and Paul Ruddock and Steve Heinz’s Lansdowne Partners with a total of 1.70 million shares. A total of 96 hedge funds out of the more than 700 tracked by Insider Monkey were invested in the stock at the end of the first quarter with their aggregate investment valued at $8.40 billion; a significant uptick compared to 76 hedge funds invested in the stock going into the first quarter of 2015.
At the end of the second quarter of 2015, Fisher Asset Management held a total of 31.82 million shares of Pfizer Inc. (NYSE:PFE) with a market value of $1.07 billion. The fund’s holding in the stock moving into the third quarter of 2015 represented 2.07% of its total portfolio value. The New York City-based pharmaceuticals company is among the world’s premier corporations in that field. Unfortunately for investors with positions in the stock, the second quarter saw the stock post a negative return of 2.8%. Year-to-date, the stock has posted growth of more than 9% however. It recently announced a plan to invest $95 million towards expanding its Caltrate and Centrum production in China. Going into the second quarter of 2015, a total of 81 hedge funds tracked by Insider Monkey were invested in the stock, with their aggregate portfolio holdings in the stock standing at $5.47 billion. Besides Fisher Asset Management, which emerged as the biggest shareholder of these hedge funds, a few other shareholders were Cliff Asness‘ AQR Capital Management with 12.94 million shares, and Ric Dillon’s Diamond Hill Capital with 10.43 million shares.
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