Investor up 37% this year sees Big Tech concentration as an opportunity to find smaller gems

The Wall Street Bull (The Charging Bull) is seen during Covid-19 pandemic in New York, on May 26, 2020.
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The manager of one mutual fund that's beating the market this year said that the concentration of the market in a few megacap tech stocks is not a concern but an opportunity.

F. Thomas O'Halloran, who manages the Growth Leaders Fund and three others for Lord Abbett, told CNBC that his team used a series of timely shifts in its portfolio this year to beat the broader market and continue a track record of outperformance. The Growth Leaders Fund, as measured by its R3 share class, has gained more than 37% year-to-date, according to Morningstar.

The fund's top positions as of June 30 were in trillion-dollar stocks, but O'Halloran said his background as a small-cap investor means that his team often looks to move "down cap" to smaller companies.