Spending by the government on health care and America's domestic energy boom are two major trends that billionaire buy-and-hold investor Ron Baron hopes to capitalize on—specifically citing one stock in each that he has recently started to buy.
"We [also] think this enormous amount of shale energy in our country is about to be exploited," Baron said. "The company I like the best is Concho [Resources]," which is about a $12.5 billion concern.
Concho has been aggregating drilling lands, he said, "and once they have this acreage, they're going to be able to be acquisition candidates by the really big oil companies who don't want to do the legwork."
A company that Baron has been a large shareholder in since its 2005 IPO is Under Armour, which supplied the uniforms for the hapless U.S. speedskating team at the Sochi Winter Olympics.
(Read more: Under Armour unfairly beaten up over suits: CEO)
He defended Under Armour CEO Kevin Plank, who told "Squawk Box" on Friday that his company had been unfairly blamed for contributing to the team's poor showing. Baron said Plank handled himself well and inspired confidence.
As for the overall stock market, the Baron Capital chairman and CEO said: "It doesn't feel very expensive to me with the way the economy is improving." He feels good about housing and auto sales, as well as lower energy costs, the availability of credit and the falling budget deficit.
"Stock prices are valued at the median level that they have been for 50 years or for 100 years," he said.
Baron does not look at short-term fluctuations in the stock market. He, instead, plays a long game—based on stocks historically rising 7 percent a year and the power of compounding money.
"If it's 7 percent a year, than you double your money in 10 years. And if it's for 20 years, which I think is likely, you're going to see a doubling again," he reiterated as he's done in past interviews. "So that means [Dow] 30,000 for the market 10 years from now. And 60,000 in 20 years."
Baron started his investment company in 1982. He said he's returned, on average, 14.2 percent a year. Baron Capital currently has $25.8 billion in assets under management.
And he puts his money where his mouth is. "My family and I are the largest investors in our mutual funds," Baron said. "I invest every single month … dollar-cost-averaging as they used to call it, because I think over the long-term the stock market is going to be much higher than it is right now."
He said his monthly contributions are always the same amount, but they're 25 percent higher than they were last year.