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Hedge funds are buying Apple. Should you?

Lawrence Lewitinn
Talking Numbers
Hedge funds are buying Apple. Should you?

The so-called "smart money" is buying Apple while retail is buying Google. Which side should you be on?

Hedge funds are fans of Apple. Mutual funds can’t get enough of Google. Whose side should you be on?

According to a recent report by Citi research Google is the single most-held stock by the top 50 actively managed mutual funds in the United States. Google appeared in the top ten holdings of 20 of those funds in the second quarter of 2013. Close behind was Microsoft, which appeared in 19 out of 50 top tens.

When it came to hedge funds, Apple was in the stock most frequently found in the top ten holdings for 2013’s second quarter. Apple had 11 appearances while second-place Priceline showed up nine times.

(Read: Move over Apple? Russian firm crosses iPhone with Kindle)

In the second quarter, at least, the bet paid off more for the mutual funds. Between April 1, 2013 and June 30, 2013, Google was up nearly 11% while Apple was down nearly 11%.

But, so far in the third quarter, the fortunes of the two companies have reversed: Google is now down 3% since July 1 while Apple is up 24% during the same time frame.

(Read: US security agencies say Android mobile main target for malware)

So, which side should an investor be on going forward?

To answer this question, we ask Steve Cortes, founder of Veracruz TJM, to look at the fundamentals of both. On the charts is Mark Newton, Chief Technical Analyst at Greywollf Execution Partners.

Watch the video above to see Cortes and Newton analyze Google and Apple.


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