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Jim Simons’ Medallion Fund is the best hedge fund that Insider Monkey has come across. The firm charges a fixed 5% management fee and takes 44% of the returns generated. After these expenses are deducted Medallion provided an average annual return of 35% to its investors. A couple of months ago, our calculations showed that Medallion’s annual alpha is 34%. The success of Medallion fund is why Jim Simons is one the wealthiest people on the planet.

Medallion fund usually trades in small quantities. The median position size is less than $2.5 million. However, Jim Simons has some positions in his portfolio that are as large as $438 million. These positions were probably acquired for Simons’ Renaissance Institutional Equities Fund (RIEF). RIEF isn’t nearly as successful as Medallion but managed to beat the index funds since inception.

We compiled Jim Simons’ largest positions that were at least $80 million at the end of December.

Company

Ticker

Return

Value (Millions)

APPLE INC

AAPL

5.2%

438

LORILLARD INC

LO

17.2%

360

JOHNSON & JOHNSON

JNJ

-4.2%

342

DIRECTV

DTV

14.1%

184

BOEING CO

BA

12.1%

169

SALESFORCE COM INC

CRM

-7.5%

163

GOOGLE INC

GOOG

-2.0%

161

ABBOTT LABORATORIES

ABT

1.1%

160

TEVA PHARMACEUTICAL INDS LTD

TEVA

-5.4%

156

NOVO NORDISK A S

NVO

10.1%

156

COCA COLA CO

KO

-1.6%

148

COLGATE PALMOLIVE CO

CL

-1.9%

145

ALCON INC

ACL

1.0%

145

HUMANA INC

HUM

20.2%

137

CHIPOTLE MEXICAN GRILL INC

CMG

16.1%

133

HEWLETT PACKARD CO

HPQ

0.1%

129

ALTERA CORP

ALTR

17.8%

125

MCDONALD'S CORP

MCD

-2.1%

125

INTEL CORP

INTC

-2.7%

123

PEPSICO INC

PEP

-1.0%

120

FAMILY DOLLAR STORES INC

FDO

4.5%

118

C F INDUSTRIES HOLDINGS INC

CF

-7.1%

117

VERISIGN INC

VRSN

8.0%

108

LOCKHEED MARTIN CORP

LMT

17.2%

108

PHILIPPINE LONG DISTANCE TELE

PHI

-14.9%

107

PRUDENTIAL FINANCIAL INC

PRU

3.1%

102

GILEAD SCIENCES INC

GILD

14.0%

102

NEWMONT MINING CORP

NEM

-10.5%

102

POTASH CORP SASKATCHEWAN

POT

8.2%

100

FRANKLIN RESOURCES INC

BEN

6.5%

100

F 5 NETWORKS INC

FFIV

-26.5%

100

PRICELINE COM INC

PCLN

16.7%

97

FREEPORT MCMORAN

FCX

-8.2%

95

QWEST COMMUNICATIONS INTL INC

Q

-9.7%

94

AMGEN INC

AMGN

-4.0%

92

ACCENTURE LTD IRELAND

ACN

4.5%

92

TAIWAN SEMICONDUCTOR MFG CO

TSM

-4.0%

92

BRISTOL MYERS SQUIBB CO

BMY

0.0%

90

LILLY ELI & CO

LLY

-0.6%

89

ALASKA AIRGROUP INC

ALK

7.1%

89

WYNN RESORTS LTD

WYNN

16.5%

88

FOREST LABS INC

FRX

-2.9%

88

BERKSHIRE HATHAWAY INC DEL

BRK.B

5.8%

85

PROGRESSIVE CORP OH

PGR

6.1%

83

YUM BRANDS INC

YUM

4.7%

81

Jim Simons’ largest positions returned 3.3% so far in 2011, vs. SPY’s 3.5% return. However, his top five positions performed much better than his entire portfolio. Apple returned 5.2% since the end of December. Hedge funds love Apple. Nearly 200 hundred hedge funds own 4% of its outstanding shares. Hedge fund stars like David Einhorn, John Griffin, Stephen Mandel, Chase Coleman and John Burbank all own AAPL in their portfolio. Lorillard, which put behind some regulatory challenges, returned 17.2%. Chase Coleman’s Tiger Global has Lorillard in its portfolio.

Simons’ fourth largest position, DIRECTV, returned 14.1% since the end of December. Chase Coleman’s Tiger Global, Lee Ainslie’s Maverick Capital, George Soros and Roberto Mignone’s Bridger Management are among the hedge funds with DTV positions.

Source: Billionaire Jim Simons' Long-Term Stock Picks