6 Bullish Ideas To Consider From This Underachieving Hedge Fund

The underperformance by 88% of hedge funds last year showed that a bad bet could sink the total performance. Making a macro call that does not play out could also lead to a return that does not beat the widely-followed S&P 500 index. What may be said about a fund that barely breaks even for the year? Whitney Tilson unfortunately underperformed the S&P 500 by 17.7%. Tilson lost 1.7%, while the S&P 500 rose 16% in 2012. Since inception, Tilson returned 110.6%, beating all other indices including the Dow Jones. [More lists: Traders are Optimistic About These Dividend Tech Stocks]

In his letter to shareholders, Tilson mentioned a number of approaches that could mean outperforming the markets once again in the future.

- Focus is on the long term
- Returning to roots
- Conservatively positioning portfolio with top ideas

Imitating Tilson

Investors who share similar insights to Tilson’s holdings could investing in the same companies. Ranked in decending order of size, his top 7 holdings are:

1) Berkshire Hathaway (BRK/A)
2) AIG (AIG)
3) Howard Hughes (HHC)
4) Citigroup (C)
5) Goldman Sachs (GS)
6) Netflix (NFLX)
7) Canadian Pacific (CP)

Interactive Chart: Compare 1-year returns for these stocks: