REUTERS/Marc Cardwell
- Warren Buffett has a $270 billion stock portfolio, and five stocks make up 75% of its value.
- Berkshire Hathaway disclosed $203 billion of Apple, Bank of America, and three other stocks.
- Buffett concentrated his portfolio last quarter by slashing and exiting several holdings.
- See more stories on Insider's business page.
Warren Buffett's stock portfolio was worth $270 billion at the last count, making it more valuable than Exxon Mobil or Comcast. Around $203 billion, or 75% of that figure, was parked in just five stocks.
The investor's Berkshire Hathaway conglomerate owned $108 billion of Apple stock as of March 31, regulatory filings show. That single holding accounted for 40% of the total value of its portfolio.
Berkshire's increased stake in Bank of America was worth $39 billion, or 14% of the portfolio. The next-biggest holding was American Express ($21 billion or 7.9% of the total), followed by Coca-Cola ($21 billion or 7.8%) and Kraft Heinz ($13 billion or 4.8%).
"Wow is that concentrated," Paul Lountzis, a longtime Berkshire shareholder and the president of Lountzis Asset Management, told Insider. "But that has always been his way."
Indeed, Buffett has repeatedly trumpeted the power of a concentrated portfolio, and warned investors against spreading their bets too much.
"Diversification is a protection against ignorance," he said at Berkshire's annual shareholder meeting in 1996. "It makes very little sense for those who know what they're doing."
Buffett added that if someone can analyze and value businesses, it would be "madness" for them to own scores of stocks and put money into their 35th-favorite business instead of their top pick. Diversifying to that extent would most likely hurt their results and increase their risks, he cautioned in his 1993 shareholder letter.
Berkshire's top five holdings accounted for 74% of its portfolio's total value at the end of December. That proportion climbed to 75% last quarter after the company slashed its Wells Fargo and Chevron stakes, trimmed its pharmaceutical and financial bets, and exited a couple of positions.
Buffett might concentrate his portfolio even more in the coming months. "He is going back to making very large commitments to stocks he likes the most," Lountzis told Insider.