Top Mutual Fund Managers Share Strategy, Stock Picks for 2024

9. Alex Umansky: Baron Fifth Avenue Growth

Umansky’s fund is focused on “big ideas.”

In a year when growth stocks trounced their value counterparts, that was a good approach.

The fund’s top two holdings, Nvidia and Amazon, have sure helped its performance this year, surging by about 232% and 70%, respectively. But Umansky has done an impressive job finding hidden gems in a market where the largest stocks have been the loudest outperformers.

For example, MercadoLibre, an Argentina-based online marketplace, has seen its shares soar 91% year-to-date. Cybersecurity firm Crowdstrike and software company ServiceNow were also big contributors.

While the fund has had a huge year, Umansky said it is built with long-term growth in mind. Since he started managing the fund 13 years ago, he said it’s averaged just 10% turnover annually, though the firm’s website says it’s been higher over the last three years at 22%.

“It’s important to know we do not rent stocks. We own businesses,” Umansky said. “We prefer big ideas because time is on your side. Even if you got your entry point wrong because the stock’s trading at too high of a valuation because of macro issues, because whatever it may be — if you’re right that the business is unique, that it has durable competitive advantages, its intrinsic value is going to compound over very long periods of time.”

Umansky said that even though some of the firms in the fund are mature mega-caps, he still believes they have significant long-term upside — to the tune of at least 500%.

“It’s a very fair qualifier that as long as we own it, we still think it’s a big idea,” Umansky said. “For example, we used to own Apple. Apple was the largest position in the fund a few years ago. We no longer own a single share. We used to own Google. We don’t Google anymore either.”

He added: “They have shifted from big ideas to holders of value, whereas Amazon, Nvidia, or Tesla are still very much big ideas.”

Ticker: BFTUX

Year-to-date return: 44%

Biggest holdings (as of September 30): Nvidia, Amazon, ServiceNow, Meta, and Tesla