Tracking Bill & Melinda Gates Foundation Portfolio - Q2 2016 Update

• The huge ~$17B portfolio has just 16 positions.
• The largest position, Berkshire Hathaway is at a whopping ~55% of the portfolio.
• Last three quarters have seen only very minor adjustments.

Gates Foundation portfolio value decreased ~2% this quarter from $17.2B to $16.8B. Over the years, the portfolio has become extremely concentrated. In their first 13F filing in 2002, they had about 27 positions and the total portfolio value was ~$1.8B. Currently, the portfolio is around ten times that while the number of positions has gone down to just 16.

To know more about Gates and the Foundation, check-out the book Bill Gates: The Inspirational Life Story of Bill Gates; Businessman, Inventor, and the World's Most Remarkable Philanthropist.

Below is a look at the top holdings:

Berkshire Hathaway (BRK.B): BRK.B is by far the largest stake at 55.42% of the portfolio. The original position is from Q3 2006 at a cost-basis in the mid-60s. The size of the stake peaked at ~87M shares in Q4 2012 and the current position is at ~64M shares. The last significant buying was in Q3 2015 when around 11M shares were purchased at prices between $129 and $144. Last two quarters saw minor trimming while the position remained steady this quarter. The stock currently trades at ~$151.

Waste Management (WM):  WM was a very small ~1.2M share position during their first 13F filing in Q3 2002. The current position is at ~18.6M shares (7.34% of the portfolio). The bulk of the position is from Q3 2009 when around 8M shares were purchased at a cost-basis in the high-20s. 2010 also saw a ~3M share increase in the mid-30s. Since then, the position has been left untouched. The stock has doubled at it currently goes for $64.35.

Canadian National Railway (CNI): CNI is the third-largest stake at 6.01% of the portfolio. Since 2008, the position has remained remarkably steady at ~17M shares. The bulk of the stake was built during the period from 2006 to 2008 at a cost-basis in the low-20s. CNI currently trades at $65.46.

Caterpillar Inc. (CAT): The 5.65% portfolio stake in CAT was first purchased in 2005 and built during the following years. Around 5M shares were purchased during the period from 2005 to 2008 at a cost-basis in the low-60s. The stock is currently at $81.69. The last significant activity was in Q2 & Q4 2014: around 1M shares were purchased at a cost-basis near $100. For investors attempting to follow Gates Foundation, CAT is a good option to consider for further research.

Wal-Mart Inc. (WMT): The top-five ~5% WMT position was established in 2006 with the bulk purchased in 2007 and 2010 at a cost-basis in the high-40s. The last significant activity was in Q4 2013 when around 500K shares were purchased at a cost-basis in the mid-70s. The stock is now at $72.50.

The spreadsheet below shows Gates Foundation’s holdings as of Q2 2016. Please visit our previous updates to get an idea on how the portfolio has progressed:

To learn more about how to profit from a strategy of cloning hedge fund picks, check out our book Profiting from Hedge Funds: Winning Strategies for the Little Guy.