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Third Avenue Management Eyes Brookfield Asset (BAM) to Perform Positively

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Jose Karlo Mari Tottoc
·3 min read
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Third Avenue Management, a disciplined, value-oriented asset manager and investment fund, published its third-quarter 2020 Investor Letter – a copy of which can be downloaded here. A return of 10.94% was recorded by the fund for the 3rd Quarter of 2020, ahead of its FTSE EPRA NAREIT Developed benchmark that returned 10.32%. You can view the fund’s top 10 holdings to have a peek at their top bets for 2021.

Third Avenue Management in their Q3 2020 Investor Letter said that they were able to distinguish a value in Brookfield Asset Management Inc. (NYSE: BAM) and initiated a position in the company. Brookfield Asset Management Inc. is an alternative asset management company that currently has a $58.8 billion market cap. For the past 3 months, BAM delivered a 14.82% return and settled at $38.74 per share at the closing of January 15th.

Here is what Third Avenue Management has to say about Brookfield Asset Management Inc. in their Investor Letter:

"Third Avenue has long championed enterprises with sound business practices run by aligned control groups that exhibit strong stewardship. Within Third Avenue’s real estate strategy, this oftentimes leads the Fund to “pass” on investments in companies with uncertain environmental liabilities, business models that could be deemed predatory, and corporate governance structures that are stacked against key stakeholders. Consequently, the select-set of real estate and real estate-related business that make it into the Third Avenue Real Estate Value Fund represent some of the true industry leaders in respect to their ESG practices, including Brookfield Asset Management (a leading alternative asset manager), which controls one of the largest privately-held portfolios of renewable energy assets globally with more than 19,000 MW of hydroelectric, wind, and solar capacity."

Managing assets, Asset Management
Managing assets, Asset Management

Copyright: olivier26 / 123RF Stock Photo

Last December 2020, we published an article telling that Brookfield Asset Management Inc. (NYSE: BAM) was in 35 hedge funds’ portfolio, almost making to its all time high statistics of 37. Brookfield Asset Management Inc. delivered a -6.68% return in the past 12 months.

As of September 2020, Third Avenue Management had a 1.3 million share position in BAM that amounted to $43.8 million. This made Third Avenue Management a part of the top 6 hedge funds that holds most of BAM’s stake, just behind Renaissance Technologies with $51 million worth of BAM shares, while Akre Capital Management tops the list with $447 million. However, our calculations showed that Brookfield Asset Management Inc. (NYSE: BAM) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website.

Disclosure: None. This article is originally published at Insider Monkey.