Legendary Hedge Funds Are Piling Into These ETFs

By Vandita Jadeja Published Dec 30, 12:32PM EST

Quick Read

Point72 and Tudor Investment increased SPY positions to 5.89% and 4.19% of portfolios respectively.
QQQ gained 21.67% year-to-date with over 50% allocation to technology and 53% in top 10 holdings.
Ray Dalio raised his IVV stake by 4.83% to over 1M shares representing 10.62% of his portfolio.

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Legendary Hedge Funds Are Piling Into These ETFs — © Thinkstock

Hedge funds continued to make buy and sell transactions throughout the third quarter. The 13F filing reflected their moves and also highlighted a few favorites. Whether you follow the moves of billionaires or like to research and make your own choices, it doesn’t hurt to keep a watch on where the hedge funds are putting money.

I believe standing by proven winners can pay off in the long term. Whether you’re looking to build a defensive portfolio or rotate some of your money into individual stocks, here are three ETFs worth considering. There’s a reason legendary hedge funds are loading up on State Street’s S&P 500 ETF (NYSE: SPY | SPY Price Prediction), Invesco QQQ Trust (NASDAQ:QQQ), and iShares Core S&P 500 ETF (NYSE:IVV).

SPDR S&P 500 ETF

The SPDR S&P 500 ETF continues to dominate the market. It tracks the S&P 500 index and holds about 500 large-cap U.S. stocks.

SPY has an expense ratio of 0.09% and a yield of 1.04%. The fund is heavily tech-focused with an allocation of 34.54% to the sector. This is followed by financials (13.44%) and consumer discretionary (10.50%). Its top 10 holdings form 46% of the portfolio and include the Magnificent Seven, such as Nvidia, Microsoft, Apple, Meta, Tesla, and Amazon.

Point72 Asset Management increased its holding in SPY by 3.3%, and its total investment in the ETF stands at 5.89%. Tudor investment added a new position in SPY with 3,650,000 shares, forming 4.19% of the portfolio.

SPY has generated a 1-year return of 14.85% and 3-year returns of 20.41%. The fund has gained 17.65% this year, and its NAV is $687.85. Despite the market uncertainty, the S&P 500 hit highs in the second half of this year, taking SPY higher.

2025 has been nothing short of a roller coaster for the stock market, and SPY managed to thrive. It offers an average annual rate of return of about 10% in addition to ultimate portfolio diversification.

Invesco QQQ Trust

In the third quarter, billionaires couldn’t get enough of the Invesco QQQ Trust. Elliott Investment Management increased its position by 3.3% and took the total holding to 5.28%, while Citadel Advisors increased its position by 0.59% and took the total portfolio to 4.04%. Additionally, Point72 Asset Management increased its stake in QQQ by 1.56%.

The fund tracks the Nasdaq 100 index, which includes the top 100 non-financial companies in the Nasdaq. The majority of these companies are tech giants, which are heavily involved in AI. This has helped the ETF gain 21.67% year-to-date and is exchanging hands for $620.87.

QQQ has an expense ratio of 0.20% and has generated a total return of 117.2% in 3 years and 497.8% in 10 years. It has over 50% allocation to the technology sector, followed by 16% in communication services and 12% in consumer cyclical. Its top 10 holdings form 53% of the portfolio and include industry giants such as Nvidia, Microsoft Corporation, Apple, Broadcom, Tesla, Meta Platforms, and Netflix.

The fund doesn’t have a high yield, but it offers capital appreciation. If you think that the tech sector will continue to drive the market higher, QQQ can be a smart choice.

iShares Core S&P 500 ETF

Billionaire Ray Dalio of Bridgewater Associates has increased his position in iShares Core S&P 500 ETF by 4.83% and holds more than 1 million shares that form 10.62% of this portfolio today. He has steadily increased his position in the ETF throughout 2025. Further, Millennium Management has added 1,217,370 shares of IVV during the quarter.

IVV is the largest holding of Bridgewater Associates, followed by SPY. The ETF tracks the performance of the S&P 500 index and has a yield of 1.04%. It holds about 500 stocks and has the highest allocation towards the tech industry, followed by financials and consumer discretionary. The ETF has an expense ratio of 0.03% and holds the Magnificent Seven in the top 10. It has $723.7 billion in assets under management.

IVV has shown impressive capital appreciation and gained 17.61% in 2025, exchanging hands for $690.91. This is one ETF that can outperform several other Vanguard and Fidelity ETFs. IVV has generated a total 3-year return of 24.90% and a 5-year return of 16.43%. iShares Core S&P 500 ETF is a surefire way to participate in the overall stock market performance at little risk.

About the Author Vandita Jadeja →

Vandita Jadeja is a financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis. She has contributed to several publications, including the Joy Wallet, Benzinga, The Motley Fool and InvestorPlace.