The most recent round of 13-F filings has shown what many of the top investors in the country were most interested in for the first quarter of the year. As usual, the 13-F reports for Q1 2017 have garnered a great deal of attention from analysts and investors looking to emulate the moves of the biggest names in the hedge fund world. Looking to top investors like Dan Loeb of Third Point and David Tepper of Appaloosa Management, signs point toward Apple (AAPL) falling out of favor with the Wall Street elite. These money managers and others like them have all sold off some or all of their positions in the tech powerhouse in the first months of 2017. Does this mean that investors across the country should follow suit?
Appaloosa, Third Point, and Tiger All Reduce or Eliminate Apple
Appaloosa, Third Point, and Julian Robertson's Tiger Management all have made headlines for their decisions to trim or completely exit their positions in Apple. Such a broad sweeping trend might indicate that it is best for other investors to turn their asset allocation elsewhere as well. Of course, there are many different reasons why these money managers may have decided to trim Apple from their stakes. It is common for hedge funds to regularly redistribute their assets among different types of companies and within different sectors, rotating their investments so as not to become stagnant and in order to capitalize as well as possible on small shifts within the market. There could be reasons more directly linked to Apple as a company: perhaps these hedge fund leaders have reason to believe that Apple's price may drop in the weeks or months to come, which would mean that their assets might best be focused elsewhere. On the other hand, it could be coincidence that several top investors all made a similar move.
Buffett Goes Against the Trend
Warren Buffett, the head of Berkshire Hathaway and one of the most respected investors in the country, has shown that there is not a consensus among hedge fund leaders about what to do with AAPL shares. Buffett owns an astounding 2.4% of all Apple shares that are outstanding. This constitutes the third-largest position in Berkshire's portfolio, behind Kraft Heinz (KHC) and Wells Fargo (WFC). Buffett, notorious for his incredibly long-term view of investments and his tendency to hold on to a small number of positions for a long period of time, has made no indication that he is trimming or exiting his Apple position in the near future. In fact, at the recent Berkshire Hathaway annual meeting, fellow executive Charlie Munger joked that "Buffett is either going crazy [to buy Apple] or learning...I hope for the latter, " according to Barron's.