These days everyone is familiar with big-brand activism, led by billionaires Carl Icahn and Bill Ackman.
Icahn has often made a splash in the media in the past year, using his influence and voice to push for change in big companies. And it works. He has made a huge impact for shareholders in Apple and Netflix. But even though both Icahn and Ackman continue to produce tremendous returns, they have limitations on what activist campaigns they can pursue.
They have size constraints, too. Both run multi-billion dollar portfolios, which all but rules out their ability to participate in smaller company investments. And that’s where smaller funds have an advantage.
One of the best, smaller, and lesser-known activist hedge funds we follow in The Billionaires Portfolio is Becker Drapkin. Becker Drapkin is a $300 million small cap activist hedge fund with an outstanding record of selecting big winners. Their average activist campaign (i.e. stock investment) has returned 130%.
Below are the top four stocks in Becker Drapkin’s portfolio. In each case, the fund owns 5% or more of the stock, which gives them a controlling interest in the company. Plus, one of the biggest determinants of success in an activist campaign is the board seat, and Becker Drapkin has at least one seat on the board of directors at each of these companies.
1) Emcore (EMKR)- This is one of Becker Drapkin’ biggest positions. They own 10% of Emcore, with board seats.
2) Fuel Systems (FSYS)- Becker Drapkin owns more than 9% of FSYS, and has board seats.
3) Comverse (CNSI) – Becker Drapkin has more than 10% of their fund’s assets in this stock, with a board seat.
4) Intevac (IVAC)- Becker Drapkin owns more than 9% of this stock, and has board representation as well.
BillionairesPortfolio.com helps average investors invest alongside Wall Street billionaires. By selecting the best ideas from the best billionaire investors and hedge funds, our exited stock investment recommendations have averaged a 31% gain since 2012, beating even Carl Icahn’s record for the same period.