Fidelity Growth Strategies Fund Q2 2025: Highlights Robinhood's Surge
Fidelity Investments recently published the second-quarter 2025 investor letter for its Fidelity Growth Strategies Fund. The letter, available for download, details the fund's performance, investment strategy, and key holdings, including a significant discussion on Robinhood Markets, Inc. (NASDAQ:HOOD).
Fund Performance and Strategy
The Fidelity Growth Strategies Fund focuses on diversified domestic equity with an emphasis on mid-cap growth investments. The fund targets high-quality companies exhibiting consistent growth and positive free cash flow. In Q2 2025, the fund's Retail Class shares yielded a 22.74% return, underperforming the 28.20% return of the Russell Midcap Growth Index.
The fund’s investment choices, including its substantial investment in Robinhood Markets, Inc. (NASDAQ:HOOD), are reflective of its growth-oriented investment style. The second quarter saw substantial gains in U.S. mid-cap growth stocks, a rebound from an earlier dip.
Robinhood Markets (HOOD): A Key Holding
The investor letter highlighted Robinhood Markets, Inc. (NASDAQ:HOOD) as a significant contributor to the fund's performance. Robinhood is a financial services platform offering access to stocks, ETFs, options, gold, and cryptocurrencies. The stock's one-month return was 17.90%, and its shares increased by 413.39% over the past 52 weeks. On September 25, 2025, HOOD closed at $122.65 per share, with a market capitalization of $108.996 billion.
Fidelity's Perspective on Robinhood's Growth
The Fidelity Growth Strategies Fund provided the following insight into Robinhood's performance:
"A holding in financial services firm Robinhood Markets, Inc. (NASDAQ:HOOD) – which was added to the benchmark index on the last day of Q2 – also meaningfully contributed. The company's shares advanced 121% for the three months. Robinhood has been excelling on all fronts recently, with strong customer growth, rising balance sizes and the successful launch of new products, particularly in the cryptocurrency space. The platform's value proposition is gaining traction, especially among young investors, and is scaling at an impressive rate. We reduced the position to take some profits, but the stock was the fund's No. 7 overweight at quarter end."
Robinhood's Market Position
While not among the 30 Most Popular Stocks Among Hedge Funds, Robinhood Markets, Inc. (NASDAQ:HOOD) is held by a significant number of hedge funds. At the end of Q2 2025, 85 hedge fund portfolios included Robinhood, compared to 76 in the previous quarter. Robinhood reported Q2 2025 revenues of $989 million, a 45% year-over-year increase driven by strong business performance.
Despite acknowledging Robinhood's potential, some analysts suggest that other investment opportunities, such as AI stocks, might offer greater upside potential and less downside risk. Some resources suggest exploring specific AI stocks that could benefit from market trends.
