Baron Funds, an investment management company, released its “Baron Asset Fund” fourth quarter 2023 investor letter. A copy of the same can be downloaded here. Declining interest rates and investors’ increasing confidence that there won’t be a hard-landing economic recession were both influenced by moderating inflation and improving labor market conditions. This bullish outlook fueled investor risk-taking and a robust equities market surge throughout the quarter. Against this backdrop, the fund gained 12.45% (Institutional Shares) in the fourth quarter underperforming the Russell Midcap Growth Index’s 14.55% return. Headwinds from the Fund’s style biases, particularly its underexposure to equities with elevated beta and residual volatility, as well as the impact of stock selection, contributed to its relative underperformance. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Baron Asset Fund featured stocks such as Arch Capital Group Ltd. (NASDAQ:ACGL) in the Q4 2023 investor letter. Headquartered in Pembroke, Bermuda, Arch Capital Group Ltd. (NASDAQ:ACGL) is an insurance company. On January 24, 2024, Arch Capital Group Ltd. (NASDAQ:ACGL) stock closed at $80.13 per share. One-month return of Arch Capital Group Ltd. (NASDAQ:ACGL) was 8.20%, and its shares gained 23.75% of their value over the last 52 weeks. Arch Capital Group Ltd. (NASDAQ:ACGL) has a market capitalization of $29.902 billion.
Baron Asset Fund stated the following regarding Arch Capital Group Ltd. (NASDAQ:ACGL) in its fourth quarter 2023 investor letter:
“Shares of specialty insurer Arch Capital Group Ltd. (NASDAQ:ACGL) gave up some gains in the fourth quarter after solid performance for most of the year. We believe the share price weakness was primarily due to a market rotation away from defensive stocks to more speculative stocks following a decline in interest rates. Company fundamentals remained strong, with net premiums written growing 23%, operating ROE expanding to 25%, and book value per share rising 30% in the third quarter. Management expects favorable market conditions will persist. We continue to own the stock due to Arch’s experienced management team and our expectation of solid growth in earnings and book value.”
A close-up image of an insurance policy with hands standing firmly on top, conveying security.
Arch Capital Group Ltd. (NASDAQ:ACGL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held Arch Capital Group Ltd. (NASDAQ:ACGL) at the end of third quarter which was 33 in the previous quarter.
We discussed Arch Capital Group Ltd. (NASDAQ:ACGL) in another article and shared Madison Mid Cap Fund’s views on the company. In addition, please check out our hedge fund investor letters Q4 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
