In this article we will present our list of the 15 best technology stocks to buy now. Click to skip ahead and see the 10 best technology stocks to buy now.
If I know that they are going to close down the stock market today and won’t open it for 10 years, I would buy the technology stocks. Most investors sheepishly invest in the S&P 500 Index ETFs with the belief that they can’t identify winners and losers, and they are better off receiving “average” returns of the market in the long-run. Even the legendary Warren Buffett has been preaching low cost S&P 500 Index funds, calling it the “best thing” for most investors.
It isn’t. Go ahead and check out Warren Buffett’s latest 13F filing. The Oracle of Omaha invested 48% of his entire 1F portfolio in Apple Inc. (NASDAQ:AAPL). His position is valued at $109 billion at the end of September. More than 20% of Berkshire Hathaway’s market cap is invested in Apple Inc. Over the last 2 years Berkshire Hathaway made more money from its Apple investment than all of the profits from all of its businesses combined. Buffett should rename his company Berkshire Hathaway Apple.
Buffett didn’t invest in S&P 500 ETFs, he invested in a technology company. Investing in Apple wasn’t a bad decision for Buffett. He was actually late to the party. If he had embraced technology stocks 10-15 years ago, Berkshire Hathaway would have been a $2 trillion company instead of Apple.
We are in the middle of a colossal technological transformation that started 30 years ago. The future belongs to technology companies. Traditional industries will be disrupted at an increasing rate. If you insist on investing in an index fund, that shouldn’t be an S&P 500 Index fund You should be investing in a technology fund. For example Invesco’s QQQ outperformed the S&P 500 ETF (SPY) by 89 percentage points over the last 5 years even though technology stocks have a 30% weight in the S&P 500 Index now.
Obviously, you can generate much higher returns by investing in individual technology stocks. That’s why we will share the list of 15 best technology stocks to buy now according to hedge funds.
Hedge funds hire some of the smartest Ivy League graduates as their analysts, have access to industry insiders whom they “consult” with, unconventional data sources that cost tens of thousands of dollars, years of experience and millions of dollars as incentives to come up with the next great investment idea. Every quarter we process around 800 hedge funds’ 13F filings to identify each hedge fund’s new moves, top stock picks, and more importantly overall sentiment changes towards each of the 4000 stocks that are publicly trading. We publish all of our analysis in our premium quarterly newsletter (download a free sample), and then share interesting bits and pieces on our website.
Last week we published the list of 30 most popular stocks among hedge funds. If you are interested in a detailed look at what hedge funds have been trading, follow this link. This article highlights the technology companies in that original list and focuses on the top 15 technology stock picks.
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 the top hedge fund stocks mostly because you were fed misleading information by other media outlets about hedge funds’ poor performance.
It is true that hedge fund investors, i.e. those people who hand their hard earned dollars to hedge fund managers, underperform because hedge funds charge huge fees and they hedge their bets. Hedge funds also invest in a diversified portfolio of good and bad ideas. By focusing on the top stock picks among all hedge funds, we have been able to identify some of the best stocks to buy in the market for years. The top 10 most popular stocks among hedge funds beat the S&P 500 Index by more than 121 percentage points over the last 6 years.
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. Our best call in 2020 was shorting the market in February when S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors did. We saw the coronavirus crash coming (see this article). We also noticed that the stock market crash will be brief and covered our shorts near the bottom of the market. Over the last 6 months we have been betting on recovery stocks. You can check out our latest free stock recommendation in this article. Keeping this mind, let's now take a look at the 15 best technology stocks to buy right now according to hedge funds:
Number of Hedge Funds: 87 (2020Q3) Number of Hedge Funds: 74 (2020Q2) Total Dollar Amount of Long Hedge Fund Positions:$2.6 billion Percent of Hedge Funds with Long Positions: 10.6% Fourth Quarter Return (through December 1st): 28.5% Popularity Ranking (2020Q2): 44 Noteworthy Hedge Fund Shareholders: Matrix Capital, Quant hedge funds
Number of Hedge Funds: 97 (2020 Q2) Number of Hedge Funds: 93 (2020 Q3) Total Dollar Amount of Long Hedge Fund Positions:$4.2 billion Percent of Hedge Funds with Long Positions: 11.4% Fourth Quarter Return (through December 1st): -1.3% Popularity Ranking (2020 Q2): 20 Popularity Ranking (2020Q1): 21 Noteworthy Hedge Fund Shareholders: Panayotis Takis Sparaggis, Ken Griffin
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Number of Hedge Funds: 82 (2020 Q2) Number of Hedge Funds: 95 (2020 Q3) Total Dollar Amount of Long Hedge Fund Positions:$7.8 billion Percent of Hedge Funds with Long Positions: 11.6% Fourth Quarter Return (through December 1st): 15.2% Popularity Ranking (2020 Q2): 38 Popularity Ranking (2020 Q1): 44 Noteworthy Hedge Fund Shareholders: Chase Coleman, Kora Management
Number of Hedge Funds: 94 (2020 Q2) Number of Hedge Funds: 100 (2020 Q3) Total Dollar Amount of Long Hedge Fund Positions:$6 billion Percent of Hedge Funds with Long Positions: 12.2% Fourth Quarter Return (through December 1st): 36% Popularity Ranking (2020Q2): 25 Popularity Ranking (2020Q1): 22 Noteworthy Hedge Fund Shareholders: Brad Gerstner, Bill Miller, Chase Coleman
Number of Hedge Funds: 113 (2020 Q2) Number of Hedge Funds: 104 (2020 Q3) Total Dollar Amount of Long Hedge Fund Positions:$12.9 billion Percent of Hedge Funds with Long Positions: 12.7% Fourth Quarter Return (through December 1st): 0.9% Popularity Ranking (2020 Q2): 13 Popularity Ranking (2020Q1): 16 Noteworthy Hedge Fund Shareholders: Karthik Sarma, Gil Simon
