To say that mutual fund portfolio managers tend to follow the herd is an incredible understatement, and it always has been. While publicly they sometimes seem reticent to discuss their holdings, especially stocks they are short sellers of, the reality is that managers tend to talk among themselves as they run in the same circles. Often the discussions are centered around their portfolios and what is in them.
With a very volatile market in play this year, many top funds have been avoiding stocks that have large exposure to China. In a new Goldman Sachs research report, the analysts found the stocks on which mutual funds are the most overweight and underweight versus the benchmark, which in some cases is the S&P 500. The Goldman Sachs team then places the various stocks in baskets of 50.
24/7 Wall St. was intrigued with the following five stocks, which are the largest overweight positions in the Goldman Sachs portfolios, as they are high-conviction stocks on which the portfolio managers tend to agree.
After a nice rally, shares of this top financial and insurance player were hit earlier in the summer and offer a solid entry point. American International Group Inc. (NYSE: AIG) provides insurance products for commercial, institutional and individual customers, primarily in the United States, Europe and Japan.
The company’s Commercial Insurance segment offers general liability, environmental, commercial automobile liability, workers compensation, excess casualty and crisis management insurance products, as well as various risk-sharing and other customized structured programs; commercial, industrial and energy-related property insurance; aerospace, political risk, trade credit, surety and marine insurance; and various insurance products for small and medium-sized enterprises.
Shareholders of AIG receive a solid 2.36% dividend. The Wall Street consensus price target was last seen at $59.69. The shares closed up slightly on Thursday at $53.75.
This top media and entertainment conglomerate remains a Wall Street favorite. Comcast Corp. (NASDAQ: CMCSA) is the largest U.S. provider of cable services, with over 22 million basic subscribers. It owns NBCU, which includes the NBC TV Networks, Telemundo, MSNBC, USA, Syfy, Bravo, E!, CNBC and several other cable networks, as well as Universal Films and Universal Theme Parks.
Comcast has invested in technology to build an advanced network that delivers among the fastest broadband speeds and brings customers personalized video, communications and home management offerings. Though, it is also one of the companies with the biggest corporate debt.
With the presidential election cycle starting up next year, this company stands to benefit big time, and a stunning number of the fund managers own the shares. Comcast is also a solid defensive play for nervous investors.
Comcast shareholders receive a 1.92% dividend. The posted consensus price target is $49.26, and the shares closed most recently at $43.77 apiece.