Hedge Funds Are Hoarding Shares of These 5 Large-Caps

Outperforming the market with large-cap stocks is not an easy task. However, it is true that these stocks tend to offer a certain degree of stability and predictability, which are not negligible features in a volatile market such as the one we’ve been seeing in recent months. Furthermore, many of these large-cap companies offer respectable dividend yields, which provide some extra insurance in times of increased volatility. With that in mind, we’ve gathered the five large-cap stocks which the investors in our database have the greatest concentration of ownership in. Read on to find out which five large-caps these top investors own the most of.

Having talked about the safety of large-cap stocks, it should be noted that their value might increase slower than that of smaller companies. This is why they don’t always offer the best risk-reward profile for smaller investors, which is evidenced by the returns of our small-cap strategy, which tracks the 15 most popular small-cap stocks among almost 800 funds that we keep tabs on. This strategy outperformed those same investors’ large-cap stock picks as well as the broader market over a period of more than a decade (see more details here).

By the end of the fourth quarter of 2015, Charter Communications, Inc. (NASDAQ:CHTR) ranked among the 20 most popular stocks among the funds we track, counting the support of 89 investment firms, up from 87 following the prior quarter. These funds held about 52.8% of the company’s total shares, valued at more than $10.84 billion. Among them is Warren Buffett’s Berkshire Hathaway, which disclosed ownership of 10.28 million shares of the company as of December 31.

As many investors know, Charter Communications, Inc. (NASDAQ:CHTR) has been in talks to acquire Time Warner Cable Inc (NYSE:TWC). However, Time Warner Inc (NYSE:TWX) and HBO have been pushing the FCC to seriously consider the implications of such a merger in regards to competition in the online video arena and the wider broadband industry. If the merger is approved, the new company would hold 18.2 million high-speed Internet subscribers. When coupled with the 23.3 million users that Comcast Corporation (NASDAQ:CMCSA) has, these two companies would control about 65% of U.S households with high-speed internet of 25 Mbps and above. Shares of Charter are up by only 1% year-to-date, but have still managed to outperform the NASDAQ 100 index, which has posted a loss of approximately 6.3% since the beginning of the year.

Another very popular stock among the funds we track is JD.Com Inc(ADR) (NASDAQ:JD), which saw the number of firms with long stakes increase by almost 10% over the fourth quarter, to 78. These 78 funds held 38.5% of the company’s outstanding stock, valued at $10.84 billion as of December 31. As of that date, Lei Zhang‘s Hillhouse Capital Management declared holding 122.6 million ADRs equivalent to 245.21 million class A shares, while Chase Coleman’s Tiger Global Management held 59.61 million ADRs equal to 119.23 million class A shares. More recently, the Chinese company posted a net loss of $0.07 per share, missing the Street’s consensus by $0.05. Revenue of $8.43 billion, however, came in above estimates of $8.15 billion. Unlike Charter, JD.com has widely underperformed major stock indexes, having posted a loss of 18.5% year-to-date.