We recently published a list of Arrowstreet Capital Stock Portfolio: Top 10 Stocks to Buy. In this article, we are going to take a look at where NVIDIA Corporation (NASDAQ:NVDA) stands against other top stocks to buy from Arrowstreet Capital’s portfolio.
Arrowstreet Capital is a Boston-based independent investment management firm known for its quantitative investment strategies and discreet market presence despite overseeing substantial assets. Founded in 1999 by Bruce Clarke, former CEO of PanAgora Asset Management, along with John Y. Campbell and Peter Rathjens, the firm was created to manage institutional investments, focusing on international and emerging market equities. Its client base includes major institutions such as the Oregon Public Employees Retirement System, CalPERS, and Macquarie Group.
In terms of investment philosophy, Arrowstreet Capital operates as a unified team to manage client portfolios through a global, quantitative approach, leveraging data-driven insights to identify market inefficiencies and generate sustainable, risk-adjusted returns. Its strategy is based on research and technology, using quantitative models to uncover investment opportunities that may not be immediately apparent to the broader market. With a focus on global equities across both developed and emerging markets, the fund constructs diversified portfolios aimed at delivering long-term value.
Moreover, Arrowstreet Capital prioritizes continuous improvement in response to shifting market conditions, integrating new data sources and employing advanced data science tools to refine its investment insights and enhance portfolio performance. While Arrowstreet does not assume that ESG-focused stocks will consistently outperform, it acknowledges the impact of environmental, social, and corporate governance factors on profitability and risk, incorporating them into its models. The firm’s collaborative team structure ensures active portfolio management, with a strong emphasis on long-term investment strategies and talent development.
Peter Rathjens is the Chief Investment Officer at Arrowstreet Capital in Boston, Massachusetts. He holds a BA from Oberlin College and an MA from Princeton University. Bruce Clarke, Co-Founder and Chairman of Arrowstreet Capital, leads an institutional asset management firm overseeing a portfolio exceeding $140 billion. Previously, he served as CEO of PanAgora Asset Management and gained international experience working in Canada, the UK, Italy, and the US. Clarke earned an MBA from London Business School and a Bachelor’s degree from the University of British Columbia. John Young Campbell, a Partner and Co-Head of Research at Arrowstreet, has an extensive background in finance, having served as President of the American Finance Association, Director of Research at PanAgora Asset Management, a professor at Princeton University, and President of the International Atlantic Economic Society. He holds a doctorate from Yale University and an undergraduate degree from the University of Oxford.
Arrowstreet Capital’s latest 13F filing for Q4 2024 reported $124.94 billion in managed 13F securities, with a top 10 holdings concentration of 28.9%. This reflects the firm’s strategic focus on high-value investments while maintaining a diversified portfolio.
Our Methodology
The stocks discussed below were picked from Arrowstreet Capital’s Q4 2024 13F filings. They are compiled in the ascending order of the hedge fund’s stake in them as of December 31, 2024. To assist readers with more context, we have included the hedge fund sentiment regarding each stock using data from over 1,000 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders as of Q4: 223
Arrowstreet Capital’s Equity Stake: $8.84 Billion
On March 10, 2025, Melius Research analyst Ben Reitzes maintained a Buy rating on NVIDIA Corporation (NASDAQ:NVDA) but lowered his two-year price target from $195 to $170, citing various challenges impacting the stock in the short term. He pointed to factors such as potential tariffs, regulatory restrictions, and advancements in computing that reduce costs as key pressures on Nvidia and other AI-related stocks. In a client note, Reitzes remarked that uncertainty in the sector has led to erratic trading behavior, with even NVIDIA Corporation (NASDAQ:NVDA) shares reflecting market confusion. The upcoming GTC conference in San Jose, where CEO Jensen Huang will deliver a keynote address on March 18, is seen as a potential turning point for the stock.
Despite the recent downturn, analysts believe Nvidia’s fundamentals remain strong, with impressive Q4 earnings reinforcing its leadership in AI technology. NVIDIA Corporation (NASDAQ:NVDA) delivered impressive financial results for the quarter ending January 2025, surpassing both its own guidance and analyst expectations. The company reported revenue of $39.3 billion, reflecting a 12% sequential increase and a remarkable 78% year-over-year growth. A key driver of this success was Nvidia’s data center segment, which saw a 93% increase year-over-year, cementing its role as a once-in-a-generation growth catalyst. Additionally, revenue from the newly launched Blackwell products reached $11 billion, exceeding management’s forecasts. Despite a 150-basis-point sequential decline, NVIDIA Corporation (NASDAQ:NVDA) maintained an adjusted gross margin of 73.5%, aligning with guidance as the company navigated higher costs associated with Blackwell’s introduction.
Looking ahead, Nvidia remains optimistic about its continued growth trajectory. The company has projected revenue of $43 billion for the April quarter, which would mark a 9% sequential increase and a 65% rise year-over-year. This forecast also surpasses consensus estimates of $42.1 billion, reinforcing NVIDIA Corporation (NASDAQ:NVDA)’s strong market position and its ability to drive demand for cutting-edge AI and data center solutions.
Overall, NVDA ranks 1st on our list of top stocks to buy from Arrowstreet Capital’s portfolio. While we acknowledge the potential for NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
