As the major indexes rebound from last year's bear market, the best mutual funds have shown a renewed interest in tech stocks, which took a particular beating in 2022. In the latest screen of new buys by top funds, leading money managers placed big bets on semiconductor stocks like Broadcom, Mobileye, Microchip Technology, Lattice Semiconductor and Allegro MicroSystems.
AVGO led demand for tech stocks among the best mutual funds. Money also flowed into chip sector stocks Axcelis Technologies, ACM Research, Cirrus Logic, Diodes, Amkor Technology, and STMicroelectronics.
Outside of the semiconductor sector, 12 other tech stocks made the cut. The best-performing funds also picked up shares in CDW, Box, Synopsys, and Ceridian, each of which has entered, recently cleared or is testing a new buy zone.
CDNS stock, which is on IBD Long-Term Leaders, is setting up a buy point in a first-stage cup pattern.
Ahead of reporting record quarterly revenue for Q4, National Instruments blasted higher. NATI stock gapped up twice in massive volume, once on Jan. 13 and again on Jan. 17. Since then, the provider of automated test and automated measurement systems has held those gains, trading in a tight range.
Agilysys and Ibex have climbed well beyond their latest breakouts.
Duck Creek Technologies, which develops intelligent solutions for the insurance sector, gapped up last month on news of its acquisition by Vista Equity Partners for $2.6 billion.
Further confirming the rebound in tech stocks and demand for them among the best mutual funds, MBLY, LSCC, AVGO, STM, CRUS and others are all gaining steam. Mobileye, for example, has continued to soar in heavy volume after retaking its 10-week moving average.
While many tech stocks are taking a breather Friday, they're showing resilience as the overall uptrend remains strong. The emergence of a rare "power trend" in the Nasdaq is helping fuel this rise in tech stocks.
Broadcom Joins Three Others In Billion-Dollar Club
Broadcom led the list of new buys by the best mutual funds among semiconductor stocks, taking in an estimated $2.9 billion. But Ferguson topped this screen of the biggest bets by these savvy investors across all sectors. The distributor of HVAC, plumbing and other solutions took in a whopping $10.8 billion.
Steel Dynamics ($1.7 billion) and SLB ($1.3 billion) round out the four-member billion-dollar club. STLD stock continues to test new all-time highs.
But Wait! There's More Buying By The Best Mutual Funds
With the market rebounding from last year's trauma, the best-performing money managers have opened their wallets to invest in more than just tech stocks.
Shoes and apparel stocks Crocs and Deckers Outdoor also landed on the list.
These top institutional investors also put 17 retail stocks in their shopping carts. Retailers building on recent breakouts include Ulta Beauty, Floor & Decor and Academy Sports & Outdoors.
Featured among promising breakout stocks on Feb. 1, Chipotle Mexican Grill remains in a buy zone.
Leading China stocks Pinduoduo and Vipshop also make the list of retailers in demand.
On the medical front, you'll find Vertex Pharmaceuticals, Catalyst Pharmaceuticals, Merck and nine others in demand among leading funds.
After dominating the list of new buys by the best funds in 2022, the number of energy stocks on this screen has decreased to just eight. In addition to SLB, oil stocks Northern Oil & Gas, Matador Resources, Hess and Denbury also make the cut.
Solar energy stocks JinkoSolar and Shoals Technologies also found their place in the sun.
Browse the full list of new buys by the best mutual funds here.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
