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According to Goldman Sachs, hedge funds held onto their favorite stocks last quarter during market turmoil as managers weathered the volatility. The Wall Street firm analyzed the holdings of 786 hedge funds with $2.3 trillion in equities as of the start of the fourth quarter, based on regulatory filings. A basket of the most popular long positions was then drawn up, dubbed Goldman’s “Hedge Fund VIP Basket”, consisting of the 50 stocks that most often appear among the top 10 positions of all hedge funds. “As the Fed tries to steer the US economy towards a soft landing, hedge fund portfolios are largely on hold,” said Ben Snyder, equity strategist at Goldman. “Quarterly position turnover fell to a new low in Q3.” Goldman said the “VIP hedge fund” list is a tool for investors looking to “follow the smart money” based on the 13-F documents. The basket has underperformed the S&P 500 since the beginning of the year with a loss of 29%. However, it has outperformed the S&P 500 in 58% of all quarters since 2001, Goldman notes. Microsoft was the most popular stock, with 82 hedge funds holding it at the end of the third quarter, according to Goldman. The Xbox maker is down 27% this year, lagging behind the market as a whole. In its latest quarterly results, Microsoft beat expectations on the top and bottom lines, but cloud computing revenue came in below expectations. The company’s quarterly forecasts also fell short of expectations. Megacap names Amazon, Netflix, Google parent Alphabet, Apple and Meta Platforms also appeared on the hedge fund’s VIP list. Uber was also heavily used by hedge funds last quarter. Earlier this month, the ride-sharing company posted a third-quarter loss but beat analysts’ earnings estimates. Uber also has a strong outlook for the fourth quarter. Visa and Mastercard credit card processors were also among hedge fund favorites in the third quarter, as was Paypal, according to Goldman.
Credit: www.cnbc.com /