Strong Volume Trends Lifted Tradeweb Markets (TW) in Q1

Baron Funds, an investment management company, released its “Baron FinTech Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. U.S. equities closed 5% lower in Q1, following a sharp decline in March. Markets started well with the S&P 500 Index reaching new highs. However, concerns about tariffs, inflation, and softer economic growth, along with concerns about AI secular growth, contributed to risk-off conditions. In the first quarter, the fund fell 1.31% (Institutional Shares) compared to a -7.52% return for the FactSet Global FinTech Index (Benchmark) and a -4.27% decline for the S&P 500 index. Since its inception, the fund has appreciated at an annualized rate of 11.27%, compared to a 2.22% return for the Benchmark. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Baron FinTech Fund highlighted stocks such as Tradeweb Markets Inc. (NASDAQ:TW). Tradeweb Markets Inc. (NASDAQ:TW) is a global financial technology company that builds and operates electronic marketplaces. The one-month return of Tradeweb Markets Inc. (NASDAQ:TW) was 7.64%, and its shares gained 29.73% of their value over the last 52 weeks. On May 23, 2025, Tradeweb Markets Inc. (NASDAQ:TW) stock closed at $145.62 per share with a market capitalization of $31.809 billion.

Baron FinTech Fund stated the following regarding Tradeweb Markets Inc. (NASDAQ:TW) in its Q1 2025 investor letter:

"Tradeweb Markets Inc. (NASDAQ:TW) operates electronic marketplaces for fixed income securities. Shares rose during the quarter due to strong volume trends driven by favorable market conditions and share gains in key products. Credit products saw accelerating growth with trading volume up 39%, while rates products saw stable trends with 14% growth. In credit, Tradeweb continued to grow faster than the market and its primary electronic trading competitor. We believe Tradeweb can achieve solid growth in a variety of macroeconomic conditions and expect further market share gains to drive long-term upside. We continue to own the stock due to Tradeweb’s strong network effects, long track record of innovation, and significant growth opportunities from the ongoing electronification of the capital markets."

Tradeweb Markets Inc. (NASDAQ:TW) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held Tradeweb Markets Inc. (NASDAQ:TW) at the end of the first quarter which was 45 in the previous quarter. While we acknowledge the potential of Tradeweb Markets Inc. (NASDAQ:TW) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Tradeweb Markets Inc. (NASDAQ:TW) and shared Lakehouse Global Growth Fund's views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.