BALTIMORE (Stockpickr) -- When it comes to mutual fund strategy, size matters.
Just take a look at Fidelity's
(FCNTX) -- a fund that had to eschew its positions in small- and mid-cap stocks as it ballooned in size to $68 billion under management.
Today, Contrafund is Fidelity's largest equity mutual fund -- quite a feat at one of the biggest fund issuers in the world. Contrafund is also the world's largest fund helmed by a single manager. Since 1990, that manager has been Will Danoff, who received Morningstar's Domestic Stock Fund Manager of the Year award in 2008.
Despite Contrafund's name, the super-sized mutual fund isn't making oversized contrarian bets right now. Instead, the fund focuses on large-gap GARP plays, minimizing turnover and eking out performance from some of the market's best-positioned and most well known names.
And the fund has been increasing its stake in a handful of Wall Street's biggest names in the most-recent quarter. Here's a glimpse at
Walt Disney Company
may be known for Mickey Mouse in most of the world, Wall Street knows that this $66 billion entertainment firm is no "Mickey Mouse stock." Shares of the company are up more than 7% year-to-date, outpacing the
2010 gains by 2.7%. Contrafund has taken advantage of that this year -- Disney is one of the fund's biggest positions at 2.17% of the portfolio.
One of Disney's biggest catalysts for growth is the company's substantial stake in television networks. And on Monday night, millions of football fans were watching one of them: ESPN. The sports network pays the NFL more than $1 billion annually to broadcast all 17 Monday Night Football games, which means that last night's Jets/Vikings game cost Disney more than $58.8 million to bring to your home -- more than the company made in ad revenues during the game (ESPN makes up the difference with additional NFL programming).
The ESPN model has become the gold standard for cable networks -- one that Disney is hoping to emulate in the future by building incredibly attractive TV brands.
Despite continued success in Disney's TV subsidiaries, other segments (like theme parks and video games) have significant economic headwinds to battle before getting on investors' good side. Still, this firm should continue to thrive thanks to its ability to generate incredibly valuable content.
continues to lure investors -- and for good reason. With the leading Internet search market share, Google is a force to be reckoned with online, and one of the best examples of how to monetize "free" products.
That hasn't stopped shares from posting a double-digit drop this year -- but newfound value could soon spark a catalyst for shares to turn around. Contrafund picked up 27,500 shares of the company in the most recent quarter, a $14.8 million stake at current prices.
Google's dominance over the competition is shocking. While firms such as
vie for increasing search market share, Mountain View, Calif.-based Google currently gets more than two-thirds of all search traffic. And the company's transition into popular culture (including its use as a verb) is no small part of that success.
The key for Google's growth will be using its cash diligently. While acquiring popular websites (such as YouTube) and funding expensive projects (such as the Nexus One) help build the company's reputation as an innovator, Google needs to increase its emphasis on projects that'll also fuel top-line growth. The two shouldn't be mutually exclusive.
Even though Contrafund only picked up 50 shares of
in the latest quarter, the fund's buying is nothing to scoff at. With a share price of $124,320, Danoff and company's Berkshire buying amounts to a $6.2 million position increase.
Headed by storied super-investor
, Berkshire Hathaway has no shortage of proponents right now -- especially after the enviable 25% run-up shares have made this year. Some of that upward momentum has been thanks to a much-wanted share
split in the firm's Class B shares
that brought share prices down from quadruple-digits to $82.95 as of yesterday's close. The added volume made Berkshire a target for smaller investors and traders, who piled into the Oracle of Omaha's company en masse earlier this year.
Now, with a strong balance sheet and well-diversified business interests, Berkshire Hathaway is looking attractive to all sorts of investors once again.
Don't fall for the hype and believe that
is a credit card play. It's not. Instead, the company is a leader in electronic payments -- be they from credit cards, debit cards or gift cards. There's a very significant difference there. While credit card issuers were subject to the risks of holding consumer debt as the credit market ground to a halt in 2008, Visa wasn't. As consumers cut back on credit usage, those same card issuers saw their revenues contract, while Visa saw its transaction volume continue to increase thanks to its debit card dominance.
Visa benefits from the leading position on both sides of the transaction. With the world's leading payment network, Visa is accepted at more locations than its competitors are. Likewise, more consumers carry Visa-braded payment cards than any other option; more than 60% of cards in consumers' wallets are on the Visa network.
Although the company does lack the dollar volume of
, its popularity should help attract additional customers in the coming quarters. It's attracting investors too -- Contrafund picked up 59,800 shares in the last quarter, a $4.4 million stake at current prices.To see the rest of the fund's plays, check out the
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At the time of publication, the Rhino Stock Report was long BRK.B.
Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.