191.50% in 3 Years: Peconic Hedge Fund’s Top 10 Stock Picks

3. The Utilities Select Sector SPDR Fund (NYSE:XLU)

Number of Hedge Fund Holders: 21

Ranking 3rd in Peconic Hedge Fund’s top 10 stock picks is The Utilities Select Sector SPDR Fund (NYSE:XLU). The Utilities Select Sector SPDR Fund (NYSE:XLU) provides a dividend yield of about 3.5%, which is attractive to investors seeking regular income, especially in a low-interest-rate environment. Companies in The Utilities Select Sector SPDR Fund (NYSE:XLU) operate in regulated industries, ensuring stable revenue and reducing the impact of market volatility. Additionally, substantial investments in infrastructure and renewable energy support long-term growth, benefiting The Utilities Select Sector SPDR Fund (NYSE:XLU) investors.

The outlook for utility stocks is improving primarily because inflation appears to be decreasing, which suggests that interest rates will also decline. Recent reports show inflation cooling, with June’s CPI down 0.1% from the previous month and closer to the Fed’s 2% target. Core inflation also remains stable. This trend suggests a possible rate cut by the Fed, anticipated around September, with an 80% likelihood of a 25 basis point reduction, according to Samuel Smith, an analyst at High Yield Investor.

Regulatory filings for the first quarter of 2024 show that Peconic Partners owned 1,611,484 shares of the Utilities Select Sector SPDR Fund (NYSE:XLU), worth $105,793,925, representing 4.69% of their portfolio.