Horizon Kinetics, an investment management firm, released its third quarter 2023 investor letter, a copy of which can be downloaded here. In its third-quarter letter, the fund delved into its financial market forecasts, emphasized the significance of securities exchanges as a vital asset class, explored blockchain technology, and acknowledged the formidable challenge of achieving consistent success in emerging technologies. Take a moment to review the fund’s top 5 holdings to gain insights into their primary investment choices for 2023.
In its Q3 2023 investor letter, Horizon Kinetics mentioned JPMorgan Chase & Co. (NYSE:JPM) and explained its insights for the company. JPMorgan Chase & Co. (NYSE:JPM) is a New York, New York-based multinational financial services firm with a $441.8 billion market capitalization. JPMorgan Chase & Co. (NYSE:JPM) delivered a 13.96% return since the beginning of the year, while its 12-month returns are up by 14.86%. The stock closed at $152.82 per share on November 17, 2023.
Here is what Horizon Kinetics has to say about JPMorgan Chase & Co. (NYSE:JPM) in its Q3 2023 investor letter:
“Blockchain technology, the kind of technology development that happens every generation or so and changes commerce and society, is happening. As a potential investment, this is entirely separate from the characteristics and prospects of the few scarcity-value cryptocurrencies like Bitcoin. Blockchain technology is in the ground-floor period of its commercial development. Few educated observers would argue that it cannot be as paradigm changing as the Internet was. And with no lesser a magnitude of ‘market cap’ and wealth creation possibilities.
Nevertheless, compared with their intuitive understanding of the early internet, investors at large barely know what blockchain is. That includes misperceptions about risk. Perhaps because it is often twinned with cryptocurrency: cryptocurrency requires a blockchain in order to exist, on the one hand, and many blockchains require cryptocurrency to operate. It’s hard to delve into one without hearing about the other.
Perhaps the lack of familiarity is because people have yet to experience blockchain services in wide-spread adoption. The facts are available, but not yet in plain sight. Which is not to say that major corporations aren’t investing seriously and with alacrity. To understand how rapid blockchain’s development is among informed participants, here is a very narrow, highly abridged recent timeline of the change in engagement with this consequential technology, shown through the actions of the largest bank in the U.S.:
In 2021, JPMorgan Chase, then a renowned energetic critic of cryptocurrency, did finally allow clients to own, upon request, specific passive cryptocurrency funds (including a few Grayscale trusts). The bank’s private client advisors, though, were not permitted to recommend any such investments. Even at that time, though, JPMorgan was already an early developer of in-house blockchain technology. A blockchain-based data system could dramatically reduce the bank’s massive backoffice operating costs while even more dramatically improving transaction and recordkeeping speeds, and error rates. In November 2022, the J.P. Morgan Wallet received U.S. Patent & Trademark Office approval for an application it had submitted more than two years earlier. This Wallet enables cryptocurrency electronic transfers, cryptocurrency-based payment processing, virtual checking accounts and payment settlement.”
Our calculations show that JPMorgan Chase & Co. (NYSE:JPM) ranks 20th on our list of the 30 Most Popular Stocks Among Hedge Funds. We also mentioned JPMorgan Chase & Co. (NYSE:JPM) in another article. JPMorgan Chase & Co. (NYSE:JPM) was in 106 hedge fund portfolios at the end of the second quarter of 2023, compared to 112 funds in the previous quarter. JPMorgan Chase & Co. (NYSE:JPM) delivered a 2.23% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters Q3 2023 page.
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Disclosure: None. This article is originally published at Insider Monkey.