Apple is the most popular stock amongst hedge funds.  Given its performance of late that is not particularly surprising.  Is this a sign that hedge funds have “run out of ideas”?  This argument rests on two points.  The first is that hedge funds are increasingly prone to herding and all that it implies.  The second is that Apple is an “obvious” stock pick and is unworthy of its popularity.  For any number of reasons it does seem that hedge funds are increasingly focused on a more limited subset of stocks.  The second argument is sketchier.  One could argue that a hedge fund that didn’t own Apple has in fact been missing out on an important opportunity.  When, and if, Apple turns it will have a big effect on the market and market psychology, but who is to say that time is imminent?  In today’s screencast we look at the role of Apple in the hedge fund universe.

Items mentioned in the above screencast:

Hedge funds have run out of good ideas.  (Fortune Finance)

Don’t forget that Apple (AAPL) underperformed for decades.  (Crossing Wall Street)

A valuation of Apple.  (Trefis)

Hedge fund herding.  (Abnormal Returns)

Apple as an outlier.  (Abnormal Returns)

Daily price chart of Apple (AAPL).  (Finviz)

Update:

Market Folly, “Does everyone clamoring about $AAPL being a hedge fund hotel realize they only own 4% of the equity capitalization?” (StockTwits)

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Please see disclosures here.

Please see the Terms & Conditions page for a full disclaimer.