Editor’s note: This article was first published in May 2013; the portfolio moves and holdings it reports reflect that time. Several companies mentioned have since changed: for example, Google became part of Alphabet in 2015 and LinkedIn was bought by Microsoft in 2016.
There have been major moves in Wall Street’s most influential portfolios: Soros Fund Management, run by billionaire George Soros, and Berkshire Hathaway, the investment arm of Warren Buffett. Both seem to agree on limiting their positions in the financial sector, although Soros seems clearer about those limits, since Buffett still has the financial sector in mind, albeit with less “energy”.
George Soros thinks it is time to get out of financial stocks and some industrials and to bet on technology stocks. One of Soros’s main moves has been to significantly cut his position in Apple, going from 157,176 shares to only 26,800, while at the same time he has doubled his bet on Google, expecting the stock to continue its upward run and forecasting good growth for it. For Soros, Google has the best outlook as a business for the next six months.
Soros is increasing his positions, betting heavily on Netflix (Nasdaq: NFLX), Qualcomm (Nasdaq: QCOM) and LinkedIn (NYSE: LNKD). He says LinkedIn has proven able to generate revenue without relying on advertising, unlike Facebook, and therefore has a very profitable business model, sustainable over time, that has managed to survive the recession.
The Soros fund sold shares, reducing its stakes in Citigroup (NYSE: C) and AIG (NYSE: AIG), and got rid of all its General Motors (NYSE: GM) shares. It also took a position in Boeing (NYSE: BA) for the first time.
Warren Buffett is not a fan of technology stocks, as he has made clear more than once. The main moves in his investment portfolio are larger positions in Chicago Bridge & Iron (NYSE: CBI), an energy infrastructure company in which he has invested a total of $402 million, and Starz (NASDAQ: STRZA), a premium cable network company in which he holds a total of $124 million.
Buffett also made some notable moves in smaller investments, buying 3 million shares of DirecTV and 2.2 million shares of National Oilwell Varco. He also doubled his investment in VeriSign.
Buffett has increased his exposure to Wells Fargo and Wal-Mart, although he has reduced his stakes in The Bank of New York and Mondelez International, while slightly increasing his stake in U.S. Bancorp.
The good news is for the solar energy sector: Berkshire Hathaway is rumoured to be about to take and build positions in solar development companies. Given that renewables are the priority for job creation in the United States, it is a sector to keep a close eye on, all the more so since Buffett is betting on it.
Further reading
- Warren Buffett’s 16 best investing tips
- Lessons from the few investors who beat the market
- Why individual investors don’t get Buffett’s returns
Featured image: Pacific Southwest Region from Sacramento, US, Public domain, via Wikimedia Commons.
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