Royce & Associates' Stock Picks With The Most Upside Potential

By Insider Monkey: “Small-cap value investment is our core business” says Chuck Royce. Royce & Associates, founded by Chuck Royce in 1972, employs a value-based approach to invest in companies with small market capitalizations. The company looks for small-cap companies that are underpriced relative to the enterprise value.

By Insider Monkey: T. Boone Pickens had decades of experience before he founded BP Capital Management, a hedge fund focusing on investments in energy futures and stocks of companies in energy sectors and energy dependent industries. BP Capital invests 80% in equities and 10% in commodities, and returned an average of 38% per year through mid 2007 since starting in August 2001.

By Insider Monkey: Chuck Royce is wildly experienced: He has been managing his own fund, Royce & Associates, since 1972. Prior to starting Royce & Associates, he worked as the director for research at Scheinman Hochstin Trotta, and a security analyst for Blair & Co before that.

By Insider Monkey: Defensive investors love dividend yielding stocks and consider them as viable options especially in inflationary environments. Dividend stocks are able to provide investors with some inflation protection and deliver better returns than long-term treasury bonds during inflationary times. We do not like the Fed's expansionary monetary policy, such as the ultra-low interest rates to which the Fed has been committed for three more years.

By Insider Monkey: Eric Mindich, founder of Eton Park Capital Management, used to work at Goldman Sachs. He was the leader of the equities risk arbitrage group and he also managed the equities division of Goldman. He became a partner at Goldman when he was 27 years old, making him the youngest partner in the history of Goldman.

By Insider Monkey: When Ray Dalio founded Bridgewater Associates, its office was just a two-bedroom apartment. Today, Bridgewater is one of the largest and best-performing hedge funds in the world. It manages over $100 billion in global investments and hires about 1200 employees researching and analyzing the market. Under Dalio’s leadership, Bridgewater returned 44.8% in 2010.

By Insider Monkey: Lee Ainslie is one of the oldest tiger cubs. He met Julian Robertson when he was managing $700 million with seven other analysts. He joined Tiger in 1990 and spent three years there. Later he launched his own hedge fund, Maverick Capital, in 1993.

By Insider Monkey: Bridgewater Associates is one of the largest and best-performing hedge funds today. Back in 1975, when the fund was founded by Ray Dalio, its office was just a two-bedroom apartment. Now it manages more than $100 billion in global investments and has nearly 1200 employees researching the market and trading in various markets and geographies. Last year, Bridgewater returned 44.8%.