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JOHANNES EISELE/AFP via Getty Images This story is available exclusively to Insider subscribers. Become an Insider and start reading now. Hedge funds are pivoting back to growth stocks, according to a note from Goldman Sachs. Below is a list of the stocks most frequently found in the top 10 holdings of hedge funds right now. It’s a group that’s outperformed its benchmark on a quarterly basis over the past 20 years. For much of this year, it’s been a downward spiral for the stock market. But the tides may be turning.
Funds are gradually pivoting back to market-leading growth stocks by moving into the information technology and consumer discretionary sectors while reducing exposure to energy and materials, according to an August 23 note from Goldman Sachs.
While the average equity hedge fund has lost 9% year-to-date, July saw a 4% gain as fortunes shifted slightly, Goldman found.
Investors seeking to follow this so-called smart money can take a peek at the stocks that appear most frequently in the top 10 holdings of hedge fund portfolios. This is exactly what the Goldman Sachs Hedge Fund VIP List (GSTHHVIP) tracks. It compiles a basket of the top long positions held by fundamentally-driven hedge funds. It’s heavily weighted in the information technology sector, which makes up 33.8% of the fund, followed by communications services at 15.7%, and then health care at 12.2%.
This year has been a tough ride for growth stocks and it has reflected on the list’s performance. Year-to-date, the GSTHHVIP has underperformed the S&P 500’s broader market exposure.
However, in the long run, it has outperformed the index in 59% of quarters since 2001, signaling strong performance if you can ride out the volatility.
Of the 50 stocks in the basket, below is a list of the top 17 held by hedge funds that have 10 to 200 distinct US equity positions as of June 30, 2022.
2. Microsoft Corp.
Markets Insider Ticker: MSFT
Sub-sector:Systems Software
Market cap ($ bn): $2,170
Funds owning stock: 139
Funds with stock as top 10 holding: 84
3. Alphabet Inc.
Markets Insider Ticker: GOOGL
Sub-sector: Interactive Media & Services
Market cap ($ bn): $1,478
Funds owning stock: 103
Funds with stock as top 10 holding: 55
5. Visa Inc.
Markets Insider Ticker: V
Sub-sector: Data Processing & Outsourced Services
Market cap ($ bn): $354
Funds owning stock: 82
Funds with stock as top 10 holding: 37
6. Apple Inc.
Markets Insider Ticker: AAPL
Sub-sector:Technology Hardware Storage & Peripherals
Market cap ($ bn): $2,819
Funds owning stock: 59
Funds with stock as top 10 holding: 36
7. Uber Technologies
Markets Insider Ticker: UBER
Sub-sector: Trucking
Market cap ($ bn): $59
Funds owning stock: 65
Funds with stock as top 10 holding: 34
8. Mastercard Inc.
Markets Insider Ticker: MA
Sub-sector: Data Processing & Outsourced Services
Market cap ($ bn): $345
Funds owning stock: 69
Funds with stock as top 10 holding: 25
9. Berkshire Hathaway
Markets Insider Ticker: BRK.B
Sub-sector: Multi-Sector Holdings
Market cap ($ bn): $671
Funds owning stock: 46
Funds with stock as top 10 holding: 22
10. ServiceNow Inc
Markets Insider Ticker: NOW
Sub-sector: Systems Software
Market cap ($ bn): $671
Funds owning stock: 51
Funds with stock as top 10 holding: 19
11. T-Mobile US Inc.
Markets Insider Ticker: TMUS
Sub-sector: Wireless Telecommunication Services
Market cap ($ bn): $184
Funds owning stock: 46
Funds with stock as top 10 holding: 19
12. UnitedHealth Group
Markets Insider Ticker: UNH
Sub-sector: Managed Health Care
Market cap ($ bn): $512
Funds owning stock: 41
Funds with stock as top 10 holding: 18
13. Fiserv Inc.
Markets Insider Ticker: FISV
Sub-sector:Data Processing & Outsourced Services
Market cap ($ bn): $71
Funds owning stock: 32
Funds with stock as top 10 holding: 17
14. Salesforce Inc.
Markets Insider Ticker: CRM
Sub-sector: Application Software
Market cap ($ bn): $187
Funds owning stock: 60
Funds with stock as top 10 holding: 17
15. Biohaven Pharmaceutical Holding Company Ltd
Markets Insider Ticker: BHVN
Sub-sector:Biotechnology
Market cap ($ bn): $11
Funds owning stock: 28
Funds with stock as top 10 holding: 16
16. Booking Holdings
Markets Insider Ticker: BKNG
Sub-sector: Hotels Resorts & Cruise Lines
Market cap ($ bn): $87
Funds owning stock: 38
Funds with stock as top 10 holding: 16
17. CrowdStrike Holdings
Markets Insider Ticker: CRWD
Sub-sector: Systems Software
Market cap ($ bn): $45
Funds owning stock: 30
Funds with stock as top 10 holding: 16
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