In this article, we discuss the top 9 stock picks of billionaire Chris Hohn.
Chris Hohn is a British hedge fund manager, philanthropist, and activist investor, best known for founding TCI Fund Management. Renowned for his aggressive yet principled investment strategies, Hohn has not only achieved exceptional financial success but has also used his influence to advocate for corporate accountability and social causes, particularly in climate change and child welfare. He was born in 1966 in England to an immigrant family. His father, a Jamaican-born car mechanic, and his mother, a legal secretary, emphasized the importance of hard work and education. Hohn excelled academically, earning a first-class degree in economics and accounting from the University of Southampton. He later attended Harvard Business School, where he graduated with an MBA and earned distinction as a Baker Scholar, placing in the top 5% of his class.
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Hohn began his career in finance with a position at Perry Capital, a New York-based hedge fund, where he honed his skills in investment management. By 2003, after gaining substantial experience and building a network of investors, Hohn decided to establish his own hedge fund with a unique vision: blending high returns with philanthropy. In 2003, Hohn founded The Children’s Investment Fund Management (TCI) in London. The hedge fund’s name reflected its dual mission: to generate exceptional investment returns and to support philanthropic efforts through a linked charity, The Children’s Investment Fund Foundation (CIFF). TCI follows a concentrated activist investment strategy, often holding large stakes in a small number of companies. Hohn uses these positions to push for changes in corporate governance, operational efficiency, and environmental practices.
TCI has delivered an average annualized return of over 15% since its inception, outperforming many peers in the hedge fund industry. As of the end of the third quarter of 2024, TCI manages over $40 billion in 13F securities, making it one of the largest hedge funds in Europe. Hohn has pushed major corporations to adopt stricter environmental policies and disclose their carbon emissions. He also advocates for linking executive compensation to environmental performance. In 2019, he publicly criticized governments and companies for not addressing aviation’s role in climate change, calling for greater transparency and accountability. Hohn’s strategy emphasizes long-term value creation, focusing on businesses with strong fundamentals but inefficiencies in management or operations.
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For this article, we selected stocks by combing through the 13F portfolio of TCI Fund Management at the end of the third quarter of 2024. These stocks are also popular among other hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Chris Hohn
Billionaire Chris Hohn’s Top 9 Stock Picks
9. Ferrovial SE (NASDAQ:FER)
Number of Hedge Fund Holders: 7
TCI Fund Management’s Stake: $820 million
Ferrovial SE (NASDAQ:FER) is a heavy infrastructure construction contractor that designs, constructs and maintains a range of projects, including roads, tunnels, highways, water treatment plants, maritime, hydroelectric plants, and railways. The first compelling factor that may hold potential for investment is the company’s operational efficiency, as EBIT margin shows an increase of 3.9% for the first nine months of 2024, depicted in the report of the third quarter of 2024. Secondly, Ferrovial and Interogo Holding, via its infrastructure investment fund Inter Infrastructure Capital (IIC), have created a joint venture vehicle (Umbrella Roads BV) to manage Ferrovial’s stakes in a number of road and parking concessions in Spain, Scotland, Ireland and Canada. The assets operate under availability payment schemes or have limited traffic risk. Moreover, Ferrovial has also been awarded three contracts to design and build the track infrastructure for the high-speed railway project HS2 in the UK.
