Anabatic Fund recently released its Q4 2020 Investor Letter, a copy of which you can download here. The fund posted a return of -11.7% in 2020 (net of fees) compared to the S&P 500 Index which returned 16.3% in the same period. You should check out Anabatic Fund’s top 5 stock picks for investors to buy right now, which could be the biggest winners of this year.
In the Q4 2020 Investor Letter, Anabatic Fund highlighted a few stocks and Berkshire Hathaway Inc (NYSE:BRK.B) is one of them. Berkshire Hathaway Inc (NYSE:BRK.B) is a multinational conglomerate holding company. In the last three months, Berkshire Hathaway Inc (NYSE:BRK.B) stock gained 15.6% and on January 27th it had a closing price of $227.36. Here is what Anabatic Fund said:
“Berkshire Hathaway (BRK.B) falls here even though it is much more than a financial company. It is also one of the biggest and best-known companies in the world, so this idea will get more yawns than cheers. As with NVR, that’s fine – good ideas are often boring.
Our investment in Berkshire grew to material size during 2020 and is now among our top three holdings. Berkshire’s large investment in Apple shares has turned into a home run, and the rest of Berkshire’s collection of businesses performed well given the circumstances. The company’s massive cash pile – which acts as both a source of opportunity and a short-term anchor on performance – has also continued to grow. The share price, however, lagged by a wide margin in 2020, finishing the year +2% and lagging the S&P 500 (of which it is the 8th-largest component) by 16 points. More importantly, Berkshire now trades at a meaningful discount to a conversative estimate of its worth.
There isn’t much new to be said about Berkshire or Warren Buffett, and a long exposition of the company’s virtues or Buffett’s management philosophy and investment acumen wouldn’t add much to this discussion. In fact, this is the first-ever mention of Buffett in one of our letters, despite having spent many hundreds of hours studying him and his process. What matters as shareholders is that we own a great collection of assets, run by a capable group of people, at a valuation that makes sense and offers an attractive return in coming years.”
In Q3 2020, the number of bullish hedge fund positions on Berkshire Hathaway Inc (NYSE:BRK.B) stock increased by about 2% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in Berkshire’s growth potential. Our calculations showed that Berkshire Hathaway Inc (NYSE:BRK.B) is ranked #15 among the 30 most popular stocks among hedge funds.
The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.
Video: Top 5 Stocks Among Hedge Funds
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:
Disclosure: None. This article is originally published at Insider Monkey.
