Warren Buffett is widely regarded as the greatest stock market investor of all time. So, I like to keep a close eye on his Berkshire Hathaway stock portfolio.
Here, I’m going to take a look at his current portfolio holdings (as reported in Berkshire Hathaway’s latest 13F filings for the period ended 30 September 2020). This is how Buffett is invested today.
Warren Buffett loves Apple
The first thing that strikes me about Buffett’s current portfolio is his enormous stake in Apple. At its current share price of $137, his holding in the tech giant is worth a staggering $132bn.
It’s worth pointing out that the total value of all the listed stocks in the Berkshire Hathaway portfolio is around $275bn. This means Apple is almost half the portfolio. Clearly, Buffett isn’t afraid to make a big bet on a company he really likes.
Buffett’s tech stocks
Buffett also owns a number of other well-known technology stocks, which is interesting because he used to avoid the tech sector. Today, he owns almost $1.8bn worth of Amazon shares, $2bn worth of Snowflake stock, and $2.6bn worth of Verisign stock. He also owns about $2.1bn worth of Visa stock and $1.5bn worth of Mastercard stock.
This means he has a healthy level of exposure to growth industries such as e-commerce and digital payments.
A balanced portfolio
But here’s the thing. While Buffett does have significant exposure to the technology sector (mainly through his Apple position), his portfolio remains quite diversified across various sectors.
For example, he owns a number of different consumer goods companies including Coca-Cola, Kraft Heinz, and Mondelez. These kinds of companies – which all own powerful well-known brands – tend to be quite defensive in nature and can provide protection during periods of volatility.
He also has plenty of exposure to the healthcare sector. Here, some of his holdings include AbbVie, Pfizer, Johnson & Johnson, Bristol Myers Squibb, Teva Pharmaceuticals, and Biogen. Healthcare is another sector that is generally quite defensive and can hold up better than other sectors during periods of stock market turbulence.
On top of this, he owns a number of financial services companies. Here, he owns big US banks such as Bank of America, Wells Fargo, and JP Morgan, as well as research firm Moody’s Corporation.
So, overall, his portfolio is quite well diversified. If tech stocks take a hit, other areas of his portfolio may offer some protection.
Risks
It’s worth noting that there are several risks associated with Buffett’s portfolio. The huge holding in Apple is one that immediately stands out. If Apple shares were to fall significantly, his portfolio would take a big hit.
Buffett also has a lack of international diversification. Nearly all his stocks are American companies that are listed in the US. If the US stock market underperforms, his performance could suffer.
It also goes without saying that Buffett’s strategy isn’t going to suit all investors. He has developed his own unique investment strategy – which suits his risk tolerance – over more than 50 years of investing.
Overall, though, there are some fascinating takeaways from Warren Buffett’s portfolio. I certainly think it’s interesting how much tech exposure he has today, given that he used to be reluctant to invest in the sector.