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RBC reports that hedge funds are now investing in industrial stocks to win over their growth favorites. Based on recently published regulatory filings, the Wall Street firm analysed stock-level holdings from 310 hedge funds and found that their overweight to the industrial sector reached a new peak at the close of the first quarter. According to the filings, the information reflects holdings up to the close of the quarter. RBC screened S & P 500 for names with most new positions added by hedge funds to compile their so-called “Hedge Fund Rockets list.” RBC reported that 3 of the 6 top names in the list were industrials. Hedge funds loved Lockheed Martin as one of their favorite industrial stocks last quarter. This year, the defense stock has gained 24% due to Russia’s attack against Ukraine which has increased demand for Lockheed Martin missile defense systems. Goldman Sachs reports that hedge funds invested in industrials and other cycles while these funds suffered from the most severe losses of tech this year. The underperformance came as growth-oriented stocks became the epicenter of 2022′s market sell-off in the face of rising interest rates. Hedge funds also liked Union Pacific as a new investment in the quarter. This railroad company has a 13% decline in 2022. A total of 20 hedge fund initiated new positions at Nielsen Holdings during the quarter. The information, data and market measurement firm has risen more than 24% this year, significantly outperforming the S & P 500.
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