David E. Shaw’s Hedge Fund Holds $136B Portfolio Favoring Small-Cap Stocks Amid Bear Market

Billionaire investor David E. Shaw, founder of D.E. Shaw & Co., L.P., has built one of Wall Street's most successful hedge funds, with a 13F portfolio valued at $136.27 billion and flagship funds delivering annualized returns exceeding 12%. Shaw's fund, known for pioneering algorithm-driven and human-managed multi-strategy investing, has achieved notable performance in 2024, with the Composite fund gaining 18% and the Oculus Fund soaring 36%, marking its best year since inception. The fund focuses on identifying small-cap stocks trading at discounted valuations with substantial upside potential, including companies like Moderna, RH, Upstart Holdings, Freshworks, and Victoria’s Secret & Co. Despite strong recent performance, D.E. Shaw & Co. is navigating a challenging market environment as major US indices have turned bearish. Reports suggest the hedge fund plans to return billions to external clients, continuing its trend of returning gains to investors amid fluctuating market conditions. Shaw's systematic and computer-driven trading strategies remain highly regarded on Wall Street for their consistent returns and innovative approach.