Hedge Funds Keep Faith in Apple and Other Big Tech Names

Apple Inc. (NASDAQ:AAPL) is an electrifying stock.  In the past three years, shares have surged almost 500 percent.  Rumors often emerge about new products or possible dividend payouts that can cause rapid price movements, but the overall trend has been higher.  As a result, more hedge funds are turning to Apple to boost portfolio returns.

According to data from Hedge Fund Research Inc., the hedge fund industry experienced net investor withdrawals of almost $130 million in the fourth quarter of 2011.  It was the first net withdraw of money for hedge funds since 2009.  However, the $2 trillion industry is still relying on popular technology names to attract customers.

Don’t Miss: Are Customers Satisfied With These Online Companies?

Goldman Sachs (NYSE:GS) recently released their Hedge Fund VIP list, which stands for Very Important Position.  According to the report, Apple is the number one owned stock among hedge funds.  The tech giant is followed by Google Inc. (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT), J.P. Morgan (NYSE:JPM) and Qualcomm (NASDAQ:QCOM).  The report explains, “Apple, Google and Microsoft rank as the top three stocks in our VIP list and have been basket constituents since inception in November 2009.”  The report goes on to explain that one out of five hedge funds holds Apple among its ten largest long positions.

Although Apple dominates the hedge fund and tablet industry, Google may enter the tablet industry and challenge the rumored soon-to-be-released iPad 3.  Richard Shim, an analyst with DisplaySearch, says the search giant is nearly ready to start producing a seven inch tablet with a 1280×800 resolution.  Google shares closed .63 percent higher on Friday, while Apple settled 1.17 percent higher.  Apple’s close at $522.41 per share also represented another all-time closing high for the stock.

Check out more insightful stories at Wall St. Cheat Sheet:
The Generation of Connectivity: New Youth Defined by Technology
Netflix Favors Apple, Android Over BlackBerry
Will Gold Miners Finally Get Some Respect?

To contact the reporter on this story: Eric McWhinnie at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com