The portfolio of the Bill & Melinda Gates Foundation’s endowment is remarkably stable over time. In part this is because Warren Buffett contributes Berkshire Hathaway shares, which account for a huge chunk of the endowment—$5.9 billion as of July. But the rest of the portfolio does not change much either, consistently emphasizing large-cap companies.
This worked to the endowment’s favor in the past year. As a recent report from Goldman Sachs says, “the biggest publicly traded companies have substantially outperformed the rest of the corporate sector and the economy as a whole.”
Not all big names outperformed, however. British Petroleum, in which the Gates trust holds a substantial position, remains down 35% from six months ago, even after the stock partially recovered from the lows caused by the Gulf of Mexico oil spill.
By contrast McDonald’s, the largest holding in the portfolio after Berkshire Hathaway, is up for that period. The Gates trust owns about $620 million of McDonald’s stock. Other big and long-time investments include Caterpillar, Walmart, Exxon Mobil, Coca Cola and Waste Management Inc.
The endowment does not go for financial companies outside Berkshire Hathaway, but there is a $66 million holding in Goldman Sachs. Also, it does not invest in tobacco companies.
Tags: Berkshire Hathaway, Bill & Melinda Gates Foundation, British Petroleum, McDonald’s, Warren Buffett
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