We recently compiled a list of the 30 Best Stocks To Invest In According to Billionaires. In this article, we are going to take a look at where The Charles Schwab Corporation (NYSE:SCHW) stands against the other stocks.
Billionaires and top hedge fund managers dominate the market with large investments in leading companies with strong track records and exceptional performance. These investors have large capital and they like to invest in established companies rather than betting on underperformers.
How’s the Stock Market Performing in 2025 So Far?
The S&P 500 index has reached its all-time highs, achieving returns of over 20% for the second consecutive year post-COVID. Billionaire investor and CEO of Berkshire Hathaway Warren Buffett made a bold move in 2024, selling a record $134 billion of net stock. Buffett’s move has raised concerns for investors and analysts. Historically, when Buffett’s firm becomes a net seller, it’s often followed by below-average market performance. Many believe that this could be a signal of stock market underperformance in 2025.
The stock market has already taken a hit in 2025 following the release of Chinese AI model DeepSeek. Almost $1 trillion was wiped away from the U.S. stock market in January 2025. Now, the market is reacting to President Donald Trump’s tariff policy, as the U.S. initiates 25% tariffs on Canada and Mexico.
“Tariffs increase the odds of a negative feedback loop in the economy. Nobody believed they would be implemented,” said Dennis Debusschere, founder of 22V Research.
The S&P 500 has been underperforming its global peers in 2025 so far, with equity indexes in China, Europe, Canada, and Mexico all racing ahead. S&P 500 has slid nearly 1.90% year-to-date, as of March 4. Whereas, the tech-heavy NASDAQ 100 index has dropped over 4% so far this year.
According to Deutsche Bank strategist Parag Thatte, equity positioning dropped significantly in the week ended February 28, plunging back down to near neutral and wiping out the post-election bump.
Billionaire investor Leon Cooperman in an interview during the Squawk Box show on CNBC recently said that the president is on the right track, but he is doing things in a very destabilizing manner. The president is focusing on reducing the deficit, which is the right thing to do, Cooperman added.
The transition phase seems to have a much bigger impact on the broader market, coupled with the tariff policy. Ironsides Macroeconomics’ Barry Knapp expects the Fed to cut a full percent this year, with the first cut projected in May. Knapp added that the economy needs to shift from government spending to capital spending for a better environment for business.
Our Methodology
For the best stocks to invest in according to billionaires, we analyzed Insider Monkey’s exclusive database of billionaire stock holdings. We selected the 30 best stocks to invest in based on the highest number of billionaire investors, updated as of Q4 2024. For the stocks with the same number of billionaire holdings, we have used the total value of billionaire holdings as a secondary metric to rank the stocks. These billionaires are founders or managers of some of the world’s leading hedge funds and companies. The stocks are ranked in ascending order of the aforementioned metrics.
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).
A corporate finance professional studying a financial performance chart.
The Charles Schwab Corporation (NYSE:SCHW)
No. of Billionaire Investors: 19
Total Value of Billionaire Holdings: $4.73 Billion
The Charles Schwab Corporation (NYSE:SCHW) is a savings and loan holding company that offers wealth management, securities brokerage, banking, asset management, custody, and financial advisory services.
The company added almost $115 billion in core net new assets during Q4 2024, bringing asset gathering to $367 billion for the year – a 4.3% annualized growth rate. The improvement in net new assets reflects the company’s ongoing progress following the Ameritrade integration. On February 11, Truist Securities analyst David Smith upgraded the price target on SCHW from $90 to $91, keeping a Buy rating on the stock. The analyst now expects SCHW to post a 5% increase in estimated earnings per share for 2025, setting it at $4 per share. His 2026 EPS estimate has increased by 5% to $5 per share.
Artisan Select Equity Fund stated the following regarding The Charles Schwab Corporation (NYSE:SCHW) in its Q4 2024 investor letter:
“The Charles Schwab Corporation’s (NYSE:SCHW) share price recovered after a weak Q3 performance. Recall that Schwab’s economics have been pressured by higher interest rates, which incented account holders to move their cash off Schwab’s balance sheet and into higher-yielding securities. This cash Exodus has been a major headwind to Schwab’s earnings power. The company’s most recent disclosures show that the balance sheet cash trends have stabilized, signaling that this headwind might turn into a tailwind. We believe it will.”
Overall SCHW ranks 30th on our list of the best stocks to invest in according to billionaires. While we acknowledge the potential of SCHW as an investment, our conviction lies in the belief that 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 SCHW but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
Disclosure: None. This article is originally published at Insider Monkey.