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Citadel LLC is one of the largest hedge funds based in the United States, with total assets under management of approximately $92.46 billion as of September 30, 2023. Since his founding in 1990, Citadel has generated a total of approximately $74 billion in profits, a record. The most successful hedge fund in history.
Citadel, founded by Ken Griffin, was the second-best performing fund in 2023, earning about $8.1 billion last year. Mr. Griffin, CEO and co-chief investment officer of Citadel, is currently the 37th richest person in the world, with a total net worth of approximately $37 billion. Let’s take a look at some of Citadel’s largest holdings.
Microsoft and Activision Blizzard
As of September 30, 2024, Citadel held approximately 5.04 million shares. Microsoft Corporation (NASDAQ:MSFT) and Activision Blizzard with 15.02 million shares, representing approximately 1.72% and 1.52% of the total portfolio, respectively.Citadel purchased Activision Blizzard stock at a median price of $87.06 per share.
Microsoft completed its acquisition of Activision Blizzard in late October last year for $95 per share, or $69 billion. After the acquisition, Citadel is estimated to have made a profit of more than $119 million.
MSFT’s stock price soared more than 56% in FY23, making it one of the best-performing stocks in Citadel’s portfolio. With a market capitalization of approximately $3.12 trillion, Microsoft is currently the most valuable company in the world.
The company’s major investments in AI over the past few years have paid off, with a minority stake in ChatGPT maker OpenAI expected to generate billions of dollars in profits.
Microsoft’s total revenue for the second quarter of fiscal 2024, ending December 31, 2023, was $62 billion, an 18% increase from the same period last year, and EPS was $2.93, an increase of 33% from the same period last year.
“We’ve moved from talking about AI to applying AI at scale,” Microsoft CEO and Chairman Satya Nadella said in the latest earnings call. By injecting, we are gaining new customers.” and help drive new benefits and productivity gains across all sectors. ”
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Boston Scientific Corporation
Citadel held approximately 21.16 million shares of Boston Scientific Corporation (NYSE:BSX) as of September 30, 2023, representing 1.21% of the total portfolio. Hedge funds bought BSX stock at an average price of $47.63.
BSX stock is up more than 13% since the beginning of the year, outpacing the benchmark S&P 500 index’s 5.2% return over the period.
Last month, the company announced plans to acquire Axonics Inc. for $3.7 billion, or $71 per share, which is expected to expand its urology business. Axonics was ranked No. 2 on the Financial Times’ list of Fastest Growing Companies of 2023. This acquisition is expected to significantly boost Boston Scientific’s growth rate in the near term.
Analysts expect BSX’s revenue to increase 9.4% year over year to $15.58 billion in fiscal 2024. The company’s EPS is expected to increase at a compound annual growth rate (CAGR) of 12% over the next five years.
Mizuho upgraded BSX’s rating to Buy on February 1st, with a price target of $80, indicating upside potential of more than 22%. Investment bank Raymond James has a “strong buy” rating on the medical device maker, with a price target of $73, reflecting an upside potential of nearly 12%.
SPDR S&P 500 ETF
Approximately 1.12% of Citadel’s total assets under management are invested. SPDR S&P 500 ETF Trust (NYSE:SPY). Investing gurus have long preached the importance and benefits of investing in low-cost, passively managed index ETFs that aim to replicate the performance of benchmark indexes.
Warren Buffett said, “I will continue to buy low-cost S&P 500 index funds,” and “I will continue to buy them through thick and thin, and especially through thin.”
The S&P 500 index crossed the 5,000 milestone on February 8, hitting an all-time high. Despite stagnant interest rate cuts and persistent macroeconomic headwinds, the index has risen more than 5% year-to-date.
UBS Global Research predicts the benchmark index will exceed 5,150 in 2024. Stock gains are expected to continue in the coming months as the Federal Reserve prepares to lower the federal funds rate in the second half of this year.
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This article, “Citadel Is The Most Successful Hedge Fund In History: Here Are Its Top Investment Picks” was originally published on Benzinga.com
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