15 Most Famous Hedge Fund Managers and Their Top Stock Picks
In this article, we discuss 15 most famous hedge fund managers and their top stock picks. If you want to see more hedge fund managers, check out 5 Most Famous Hedge Fund Managers and Their Top Stock Picks.
According to data provider Hedge Fund Research (HFR), hedge funds in 2022 reported their worst performance since 2018, mainly due to underperforming equities. As per the HFRI 500 Fund Weighted Composite Index, which tracks the performance of several major global hedge funds, hedge funds as a whole had a decline of 4.25% in the previous year. Despite a 10.37% loss, hedge funds outperformed the S&P 500, which had a decline of 19.4% in its worst year since 2008.
Although hedge fund managers who invest in stocks and cryptocurrency faced difficulties, they still found opportunities to earn positive returns. According to HFR, macro hedge funds were among the best performers. The HFRI Macro Index, which tracks performance of macro funds, was up 9.31% due to positive returns from commodity-based, quantitative, and trend-following strategies. Patrick Ghali, managing partner of hedge fund advisory firm Sussex Partners, told Reuters on January 9:
"Investors need to look under the surface to understand the industry performance last year. Long-short hedge funds are the biggest asset-weighted part of the industry. Overall, I believe it was a good year for hedge funds."
Ken Griffin, the founder of Citadel Investment Group, has been named the top hedge fund manager by LCH Investments recently, in their annual ranking of the world's top 20 hedge fund managers. The ranking estimates that Citadel generated $16 billion in profits for its investors in 2022 and has accumulated $65.9 billion in net gains since its foundation in 1990. Despite Bridgewater's estimated net gains of $6.2 billion in 2022, Citadel overtook Dalio's fund to become the top gainer on the all-time list. Investors look towards the top holdings of famous hedge fund managers in order to navigate the uncertain markets better. Some of the top stock picks of Wall Street money managers include Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Bank of America Corporation (NYSE:BAC).
We picked the 15 most famous hedge fund managers based on comparison on Google Trends. These money managers have been most searched on Google. We also highlighted their top stock picks based on 13F portfolios as of the end of the third quarter of 2022.
Ken Griffin of Citadel Investment Group
Most Famous Hedge Fund Managers and Their Top Stock Picks
15. Kenneth Fisher
Kenneth Fisher is a billionaire American financial analyst, author, and the founder of Fisher Asset Management, a hedge fund with a stock portfolio worth $133.40 billion as of the third quarter of 2022. Ken Fisher’s top holding as of Q3 2022 is Apple Inc. (NASDAQ:AAPL), with the billionaire owning more than 59 million shares worth $8 billion, representing 6.13% of the total 13F portfolio. As of January 29, Ken Fisher’s net worth came in at $7 billion.
Like Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Bank of America Corporation (NYSE:BAC), Apple Inc. (NASDAQ:AAPL) is one of the top stock picks of famous hedge fund managers.
Here is what Wedgewood Partners has to say about Apple Inc. (NASDAQ:AAPL) in its Q3 2022 investor letter:
“Apple grew quarterly revenues +14% (foreign exchange adjusted) driven by +16% growth in iPhone revenues (also foreign exchange adjusted). iPhone revenue growth was particularly impressive because The Company is compounding on +47 growth from a year ago. Apple’s installed base is over 1.8 billion devices which helps drive a software and services business, which in turn has generated almost $80 billion of revenue over the past four quarters and is up +60% compared to calendar 2019 (pre-Pandemic). As we have highlighted in the past, Apple’s relentless focus on the development and integration between hardware (especially integrated circuits) and software, continues to add significant value for customers of their products and services. We expect this favorable competitive dynamic to continue for the foreseeable future.”
14. Carl Icahn
Carl Icahn is a billionaire American investor who also founded Icahn Enterprises, and is a majority shareholder of the conglomerate. Icahn is a legendary corporate raider, and his core investment vehicle is Icahn Enterprises. He also manages a hedge fund consisting of his own money and his largest stock position is Icahn Enterprises L.P. (NASDAQ:IEP), comprising 288.5 million shares worth $14.3 billion, representing 67.51% of the 13F portfolio as of Q3 2022. Carl Icahn’s net worth as of January 29 stood at $18.5 billion, and he is one of the most famous hedge fund managers.
Here is what CrossingBridge Advisors has to say about Icahn Enterprises L.P. (NASDAQ:IEP) in its Q3 2022 investor letter:
“Icahn Enterprises LP, headed by investor Carl Icahn, is a diversified holding company with interests in investments, energy, automotive, food packaging, real estate, home fashion and pharmaceuticals. The investment segment derives revenues from gains and losses from investment transactions. Other operating segments, in most cases, are independently operated businesses obtained through a controlling interest.
As of 2Q22, Icahn Enterprises had Indicative Net Asset Value of $6.6 billion, consolidated debt of $7.1 billion and total liquidity, comprised of cash, investment funds and revolving credit availability, of $7.2 billion. Moreover, as of the end of 3Q22, it had an equity market capitalization of $16.0 billion. Thus, we have no concern regarding credit quality. We have traded in and out of the IEP 4.75% senior unsecured bond, due September 2024, since it was issued in February 2020.
In 3Q22, amidst the downdraft in the high yield market, we were able to purchase these bonds at a yield to maturity over 8.20%, very attractive for a 2-year note with such strong credit quality. Purchased at a discount, the bond would have an even higher annualized total return were the company to redeem it prior to September 15, 2023, when it becomes a current obligation. We expect to continue adding to this position opportunistically.”
13. Stanley Druckenmiller
Stanley Druckenmiller is an American philanthropist, hedge fund manager, and investor. He used to be the chairman and president of Duquesne Capital, which he established in 1981. In August 2010, Druckenmiller closed his hedge fund, Duquesne Capital Management, for outside investors. The fund had assets worth $12 billion. At the end of September 2022, Coupang, Inc. (NYSE:CPNG) was the largest holding in Duquesne Capital’s portfolio, with 19.4 million shares worth $324 million.
12. Bill Ackman
Bill Ackman is the founder and chief executive officer of Pershing Square Capital Management, which was established in 2004. In March 2020, Ackman generated a return of $2.6 billion from a $27 million investment in credit hedges, as the markets collapsed due to the spread of COVID-19. He is one of the most famous hedge fund managers on Wall Street. The largest stock in Pershing Square Capital Management’s Q3 2022 portfolio is Lowe's Companies, Inc. (NYSE:LOW), with 10.3 million shares worth nearly $2 billion, representing 24.73% of the total holdings.
Baron Funds made the following comment about Lowe’s Companies, Inc. (NYSE:LOW) in its Q3 2022 investor letter:
“Lowe’s Companies, Inc. (NYSE:LOW) is the second-largest home improvement center in the U.S. The company has several competitive advantages including scale, distribution efficiencies, interconnected retail through stores/internet, excellent management, and a strong balance sheet. The company is valued at only 14 times estimated earnings per share versus its long-term average P/E multiple of approximately 18 times estimated earnings per share.
The shares of Lowe’s Companies, Inc. increased 7% in the most recent quarter following better-than-expected quarterly business results. Lowe’s is the second largest home improvement center in the U.S. The company has several competitive advantages including scale, distribution efficiencies, interconnected retail through stores/internet, excellent management, and a strong balance sheet. We believe the shares are attractively valued at only 14 times estimated earnings per share versus a long-term average P/E multiple of approximately 18 times estimated earnings per share.”
11. Jim Simons
Jim Simons is the founder of Renaissance Technologies, a quantitative hedge fund that oversees a portfolio worth $70.6 billion as of Q3 2022. After establishing Renaissance Technologies in 1982, he retired in 2010 but continues to be involved with the firm and still benefits from its funds. Simons, with a net worth of $28.1 billion as of January 29, is one of the most famous Wall Street money managers. The largest position of Renaissance Technologies as of the end of September 2022 was Novo Nordisk A/S (NYSE:NVO), with 15.30 million shares worth $1.5 billion.
Mawer Investment Management made the following comment about Novo Nordisk A/S (NYSE:NVO) in its fourth quarter 2022 investor letter:
“Reflecting the broad nature of the market’s advance during the quarter, the vast majority of portfolio holdings delivered positive returns. Some of the stronger performers across our equity funds were those that could be classified as more economically sensitive in nature, bolstered by the market’s hope that central banks may not need to be as aggressive as feared in tightening monetary policy with the latest inflation prints having shown signs of moderation. This included companies such as footwear and apparel brand Nike, coffee machine manufacturer De’Longhi, and industrial equipment dealer Finning International. Other standout performers included health care giant Novo Nordisk A/S (NYSE:NVO) and specialty insurer Trisura Group, with both companies reporting strong results.”
10. David Einhorn
David Einhorn is the founder and president of Greenlight Capital, a hedge fund with $1.4 billion in assets as of the third quarter of 2022. The hedge fund has generated a 15.4% net return since its establishment in May 1996. He gained fame during the financial crisis of 2008, by raising concerns about Lehman Brothers' financial statements and alleging that the investment bank was not transparent about its potential risks. Green Brick Partners, Inc. (NYSE:GRBK) is the biggest position in Greenlight Capital’s Q3 portfolio, with nearly 17 million shares worth $361.5 million, representing 25.6% of the total holdings.
Moon Capital made the following comment about Green Brick Partners, Inc. (NYSE:GRBK) in its Q4 2022 investor letter:
“For portfolio management reasons, we sold our stake in LGI Homes during the fourth quarter (at a loss.) We continue to hold our shares in another homebuilder, Green Brick Partners, Inc. (NYSE:GRBK), a position in which we currently have an unrealized gain.
The recent signs of what may be the early stages of a housing market downturn have many investors calling for a major housing correction on the order of that experienced in 2007. While there may be certain similarities to the last housing crisis as it relates to affordability, there are also some very major differences.
In 2007, the housing market had experienced years of construction in excess of both historical averages and new household formation – the exact opposite of conditions today. There are a host of other differences, as well. Consumers have much better balance sheets today than they did in 2006, with homeowner equity currently at an all-time high. Unlike the last housing bubble, delinquencies remain near all-time lows, so the forced credit sales that compounded the problem in the last bubble should be far less of an issue. Another material difference is the adjustable-rate mortgage (ARM). Towards the end of the last housing boom, ARMs accounted for well above 30% of all mortgages. This created a ticking time bomb as rate increases flowed into higher payments. Today ARMs account for less than 10% of the U.S. mortgage market.
Putting it all together, we think builders are in a much better position to ride out the near-term weakness in the housing market than they were during the previous cycle. At today’s prices, we continue to see opportunity in the homebuilding sector, despite the significant near-term headwinds. We also believe that the current housing correction is likely to be more regional in nature and that Green Brick, which operates largely in business-friendly, pro-growth markets, will significantly outperform its peers.”
9. David Tepper
David Tepper is an American billionaire hedge fund manager who is the president and founder of Appaloosa Management. As of the end of the third quarter of 2022, Appaloosa Management has a portfolio worth $1.36 billion. As of January 29, Tepper’s net worth came in at $18.5 billion. Constellation Energy Corporation (NASDAQ:CEG) is the largest position in David Tepper’s Q3 portfolio, with 2.6 million shares worth $218.8 million.
Alger Capital made the following comment about Constellation Energy Corporation (NASDAQ:CEG) in its Q3 2022 investor letter:
“Constellation Energy Corporation (NASDAQ:CEG) is America’s leading clean energy company, based on carbon-free production. The company is the largest supplier of clean energy and sustainable solutions to homes, businesses, governments, community aggregations, and a range of wholesale customers (such as municipalities, cooperatives, and other end markets) across the continental U.S., backed by approximately 32,400 megawatts of generating capacity consisting of nuclear, wind, solar, natural gas and hydroelectric assets. Constellation produces nearly 10% of the nation’s carbon-free energy.
Shares outperformed during the third quarter primarily due to the Inflation Reduction Act (IRA). Signed into law in august, the bill provides a nuclear production tax credit of approximately $43.75 per megawatt hour of energy generated. This credit favorably impacted earnings, resulting in an increase in Constellation’s share price.”
8. Cathie Wood
Catherine Wood is an American investor, who is the founder, CEO, and CIO of ARK Investment Management. Wood established ARK in 2014 with the goal of presenting active stock portfolios in an ETF format. Catherine Wood is a strong supporter of Elon Musk's Tesla. She forecasts that the electric car company will eventually be valued at more than $3 trillion. ARK Invest has a Q4 2022 portfolio worth $11.5 billion, and Exact Sciences Corporation (NASDAQ:EXAS) is the biggest position, with 16 million shares valued at $794 million.
Here is what RiverPark Large Growth Fund has to say about Exact Sciences Corporation (NASDAQ:EXAS) in its Q4 2021 investor letter:
“Exact Sciences: EXAS shares declined on a disappointing recovery in Cologuard screening due to COVID. Despite continued revenue growth from Precision Oncology and COVID testing, and Cologuard screening revenue growth of 30%, COVID restrictions limited access to physicians’ offices for the company’s and its Pfizer Joint Venture sales force as well as causing a severe drop off of in-person wellness visits.
In the last year, Exact has also pivoted the company significantly from its single cancer screening tests (Cologuard for colon cancer and Oncotype for breast cancer) to multi-cancer screening through its Thrive acquisition, and to minimal residual disease and recurrence monitoring through its Ashion and Tardis acquisitions. Through this pivot, Exact has tripled its market opportunity from $20 billion to $60 billion.”
7. Steven Cohen
Steven Cohen is the founder of Point72 Asset Management, with a Q3 2022 portfolio worth $25 billion. In 2020, Cohen purchased the New York Mets for $2.4 billion, making it the most expensive sale of an MLB team in history. Steven Cohen has a net worth of $17.5 billion as of January 29. Point72 Asset Management’s largest holding is Biogen Inc. (NASDAQ:BIIB), with the hedge fund owning 1.67 million shares worth $448 million at the end of the third quarter of 2022.
ClearBridge Investments made the following comment about Biogen Inc. (NASDAQ:BIIB) in its Q3 2022 investor letter:
“Biogen Inc. (NASDAQ:BIIB) was the leading contributor among several biopharma names, boosted by positive, pivotal clinical data for its next-generation Alzheimer’s treatment Lecanemab. In a pivotal trial, the drug proved safe and efficacious in slowing progression of Alzheimer’s disease.”
6. Ray Dalio
Ray Dalio is the founder of Bridgewater Associates, which has a portfolio of $19.75 billion as of the end of the third quarter of 2022. To ensure the continuation of Bridgewater after his departure, Dalio shifted the company into a partnership in 2018 and gave a larger ownership stake to the employees. The Procter & Gamble Company (NYSE:PG) is the largest holding of Bridgewater Associates, with 6.61 million shares worth $835.20 million.
In addition to Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Bank of America Corporation (NYSE:BAC), The Procter & Gamble Company (NYSE:PG) is a popular stock pick of famous Wall Street money managers.
Rowan Street Capital made the following comment about The Procter & Gamble Company (NYSE:PG) in its Q4 2022 investor letter:
“Let’s look at The Procter & Gamble Company (NYSE:PG). Dividend yield is 2.4%. Earnings are forecasted to grow at 5.9%, and its current earnings multiple is at 25x. Now, let's say over the next 3-5 years the market loses interest in the “safe”, mature companies that grow at anemic rates and gets an appetite for growth again. It’s very unlikely that Mr. Market will be paying 25x for 5.9% earnings growth. Let's assume that multiple declines to the market average of 18x — that would be ~6.9% drag per year on the total expected return over next 3-5 years. If we get 2.4% (dividend) + 5.9% (earnings growth) – 6.9% (decrease in earnings multiple) = 1.4% (annual return we can expect on average from this stock).”
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Disclosure: None. 15 Most Famous Hedge Fund Managers and Their Top Stock Picks is originally published on Insider Monkey.