Baron Opportunity Fund recently published its fourth-quarter commentary – a copy of which can be downloaded here. During the fourth quarter of 2020, the Baron Opportunity Fund returned 23.02% (institutional shares). In comparison, the benchmark S&P 500 Index was up 12.15%, while the Russell 3000 Growth Index was up 12.41%. You should check out Baron’s top 5 stock picks for investors to buy right now, which could be the biggest winners of 2021.
In the Q4 2020 Investor Letter, the fund highlighted a few stocks and Alibaba Group Holding Limited (NYSE:BABA) is one of them. Alibaba Group Holding Limited (NYSE:BABA) is a Chinese e-commerce company. In the last three months, Alibaba Group Holding Limited (NYSE:BABA) stock lost 10.2% and on March 17th it had a closing price of $233.34. Here is what the fund said:
“Alibaba Group Holding Limited is the largest retailer and e-commerce company in China. Alibaba operates shopping platforms Taobao and Tmall and owns 33% of Ant Group, which operates Alipay, China’s largest third-party online payment provider. Shares were down on the news that Chinese regulators had launched an investigation into Alibaba for suspected monopolistic behavior. We continue to believe Alibaba’s core business remains highly profitable, complemented by rapid growth in the cloud business and inflections in the Cainiao logistics and New Retail segments.”
In Q4 2020, the number of bullish hedge fund positions on Alibaba Group Holding Limited (NYSE:BABA) stock decreased by about 6% from the previous quarter (see the chart here), so a number of other hedge fund managers don’t believe in Alibaba’s growth potential. Our calculations showed that Alibaba Group Holding Limited (NYSE:BABA) is ranked #7 among the 30 most popular stocks among hedge funds.
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.
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best innovative stocks to buy to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:
Disclosure: None. This article is originally published at Insider Monkey.