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Pro Analysis

These 17 stocks are hedge funds' new favorites, Goldman says


The headquarters of eBay in San Jose, California.
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The headquarters of eBay in San Jose, California.

Stocks most owned by the smart money are handily beating the market this year, according to Goldman Sachs' latest "Hedge Fund Trend Monitor" report.

Four times a year, hedge funds file their long positions with the SEC and the information is released to the public 45 days after each quarter ends. Goldman's current hedge fund VIP list consists of the 50 stocks that "appear most often among the top 10 holdings of fundamentally driven hedge fund portfolios" for the December quarter.

Hedge funds' "favorite long positions help drive strong performance in early 2017," strategist Ben Snider wrote in a note to clients Tuesday. "From an implementation standpoint, the hedge fund VIP list offers a tool for investors seeking to 'follow the smart money' based on 13-F filings."

The firm's basket of the top holdings of hedge funds is up 7 percent this year through Feb. 14 versus the S&P 500's 5 percent return. Snider cited how the list beat the market's performance in 65 percent of quarters and by 2.4 percentage points annually on average since 2001. Turnover for the VIP list was slightly higher than normal with 17 new names in the December quarter compared with the historical average of 16 stocks.

Here are the 17 new stocks entering the Goldman hedge fund VIP list.