How Does the Bill and Melinda Gates Foundation Invest Its Money?
Connect with us

Datastream

How Does the Bill and Melinda Gates Foundation Invest Its Money?

Published

on

How Does the Bill and Melinda Gates Foundation Invest Its Money?

The Briefing

  • The Bill and Melinda Gates Foundation Trust has a total portfolio value of over $25 billion
  • Almost half of the money is invested in Berkshire Hathaway, a holding company run by chairman and CEO Warren Buffett
  • The trust favors industrial stocks, with a 34% weighting in the sector

How Does the Bill and Melinda Gates Foundation Invest Its Money?

Bill and Melinda Gates have announced they are ending their marriage, but will continue to work together at their foundation.

The Bill and Melinda Gates Foundation, launched in 2000, is the largest private philanthropic organization in the United States. It has spent over $50 billion on global public health over the last two decades, including $1.75 billion on COVID-19 relief.

Of course, the foundation’s assets are managed by a trust until they are ready to be distributed to grantees. Here’s a look at how the Bill and Melinda Gates Foundation Trust invests its assets.

The Portfolio Breakdown

The trust has invested 100% of its holdings in stocks. It holds almost half of its value in Berkshire Hathaway, the holding company run by Warren Buffett.

StockValue% of Portfolio
Berkshire Hathaway$11.8B45.5%
Waste Management$2.6B10.0%
Caterpillar$2.6B10.0%
Canadian National Railway$1.9B7.2%
Walmart$1.6B6.4%
Crown Castle$1.0B3.9%
Ecolab$991M3.8%
UPS$960M3.7%
FedEx$921M3.6%
Schrodinger$518M2.0%
Coca-Cola FEMSA$294M1.1%
Grupo Televisa$213M0.8%
Liberty Global$156M0.6%
Apple$133M0.5%
Amazon$102M0.4%
Alphabet (Google)$102M0.4%
Twitter$15M0.1%
Liberty Latin America$14M0.1%

However, the portfolio is more diversified than initially meets the eye—Berkshire Hathaway itself is invested in almost 50 stocks.

Shrodinger, a healthcare-focused software company that makes up 2% of the trust’s total portfolio, was one of the best performing stocks of 2020 by price returns. The portfolio has also been boosted by delivery companies UPS and FedEx, both of which saw their share prices more than double over the last year as online shopping took off.

While the trust is dominated by U.S.-domiciled companies, a few foreign names do make the list. For example, Canadian National Railway makes up over 7% of the portfolio, while the Latin American bottler Coca-Cola FEMSA makes up just over 1%.

The Future of the Foundation

The trust continues to be managed by a team of outside investment managers, whose decisions have a critical impact on the amount of money the Bill and Melinda Gates Foundation has to fund its initiatives. For example, if Berkshire Hathaway were to dip 10%, this would drop the portfolio value by more than $1 billion.

In addition, the foundation is funded in part by the Gates’ personal donations—more than $36 billion from 1994 to 2018. Should Bill and Melinda go on to create their own separate philanthropic efforts post-divorce, the foundation may have a smaller portfolio to pull from going forward.

» Like this? Then you might also like The Warren Buffett Empire in One Giant Chart

Where does this data come from?

Source: SEC filings and MarketWatch
Notes: Portfolio holdings are as of December 31, 2020. Stock values are as of market close on May 3, 2021.

Click for Comments

Datastream

Seeing Red: Is the Heydey of Pandemic Stocks Over?

Worries over post-COVID demand and rising interest rates have fueled a market selloff, with pandemic stocks hit particularly hard.

Published

on

pandemic stocks

The Briefing

  • Global equities are in a downward spiral, and experienced their worst week in more than a year.
  • Worries about slowing post-COVID demand and rising rates fueled the selloff.
  • Pandemic stocks were some of the hardest hit, with Shopify and Netflix dropping 35.3% and 33.5% respectively.

Seeing Red: Is the Heydey of Pandemic Stocks Over?

The stock market, and the stocks that flourished during the COVID-19 pandemic in particular, are off to a rough start in 2022. If you’ve been watching your investment accounts, chances are you’ve been seeing a lot of red. Shaken by the uncertainty of a pandemic recovery and future interest rate hikes, investors have been selling off their stocks.

This market selloff—which occurs when investors sell a large volume of securities in a short period of time, leading to a rapid decline in price—has investors concerned. In fact, search interest for the term “selloff” recently reached peak interest of 100.

2022 market selloff

Which stocks were the hardest hit, and how much are their prices down so far this year?

The Lackluster Returns of Pandemic Stocks

Pandemic stocks and tech-centric companies have suffered the most. Here’s a closer look at the year-to-date price returns for select stocks.

CompanyYear-to-Date Price Return
Shopify-35.3%
Roblox-30.2%
Block-28.0%
Moderna-31.9%
Zoom-19.9%
Netflix-33.5%
Snapchat-31.1%
Peloton-23.1%
Coinbase-23.5%
DocuSign-26.0%
Amazon-16.3%
Robinhood-29.6%

Price returns are in U.S. dollars based on data from January 3, 2022 to January 21, 2022.

Netflix fueled the selloff after it reported disappointing subscriber growth. The company added 8.28 million subscribers in the fourth quarter, which is less than the 8.5 million it added in the fourth quarter of 2020. It also projects to have slower year-over-year subscriber growth in the near term, citing competition from other streaming companies.

Meanwhile, Coinbase stock lost nearly a quarter of its value so far this year. As the price of cryptocurrencies such as Bitcoin have plummeted, investors worry Coinbase will see lower trading volume and therefore lower fees.

The contagion also spread to other pandemic stocks, such as Zoom and DocuSign, as investors began to doubt the staying power of stay-at-home stocks.

Following the Herd

While investor exuberance drove many of these stocks up last year, 2022 is beginning to paint a different picture.

Investors are worried that rising rates will negatively impact high-growth stocks, because it means it’s more expensive to borrow money. Not only that, but they also may see Netflix’s growth as harbinger of things to come for other pandemic stocks.

The psychology of the market cycle also plays a role—amid these fears, investors have adopted a herd mentality and begun selling their shares in droves.

Where does this data come from?

Source: Google Finance

Continue Reading

Datastream

How People Around the World Feel About Their Economic Prospects

In many of the world’s largest economies, including the U.S., Germany, and China, optimism around economic prospects sits at an all-time low.

Published

on

economic prospects of people around the world

The Briefing

  • Economic prospects are at an all-time low in nine countries, including the U.S., Canada, Germany, Japan, and China
  • China and the U.S. experienced the biggest year-over-year drops, at -8 p.p. and -6 p.p., respectively

How Countries Feel About Their Economic Prospects

Each year, the Edelman Trust Barometer report helps gauge the level of trust people place in various systems of power.

The report is also a useful tool to gauge the general mood in countries around the world—and when it comes to how people in developed economies feel about the near future, there’s a very clear answer: pessimistic. In fact, optimism about respondents’ economic prospects fell in the majority of countries surveyed.

Here’s a full look how many respondents in 28 countries feel they and their families will be doing better over the next five years. Or, put more simply, what percentage of people are optimistic about their economic circumstances?

Country% who are optimisticAll-time low?Change from 2021 (p.p.)
🇯🇵 Japan15%-1
🇫🇷 France18%-1
🇩🇪 Germany22%-2
🇮🇹 Italy27%0
🇳🇱 Netherlands29%-1
🇬🇧 UK30%+2
🇷🇺 Russia31%+1
🇨🇦 Canada34%-1
🇪🇸 Spain36%+1
🇰🇷 South Korea39%+6
🇺🇸 U.S.40%-6
🇦🇺 Australia41%-2
🇮🇪 Ireland42%-1
🇸🇬 Singapore43%-1
🌐 Global51%0
🇲🇾 Malaysia55%0
🇦🇷 Argentina60%-2
🇹🇭 Thailand60%-2
🇨🇳 China64%-8
🇿🇦 South Africa66%-2
🇲🇽 Mexico68%-1
🇧🇷 Brazil73%0
🇸🇦 Saudi Arabia73%0
🇦🇪 UAE78%+6
🇮🇳 India80%0
🇮🇩 Indonesia81%+11
🇨🇴 Colombia83%-1
🇳🇬 Nigeria87%n/a
🇰🇪 Kenya91%-2

Interestingly, nine countries (those with checkmarks above) are polling at all-time lows for economic optimism in survey history.

Whose Glass is Half Empty?

Japanese respondents were the most pessimistic, with only 15% seeing positive economic prospects in the near term. Only 18% of French respondents were economically optimistic.

While most developed economies were slightly more optimistic than Japan and France, all are still well below the global average.

As tensions between China and the U.S. continue to heat up in 2022, there is one thing that can unite citizens in the two countries—a general feeling that economic prospects are souring. As the U.S. heads into midterm elections and China’s 20th National Party Congress takes place, leaders in both countries will surely have the economy on their minds.

Whose Glass is Half Full?

Of course, the mood isn’t all doom and gloom everywhere. The United Arab Emirates saw a 6 percentage point (p.p.) jump in their population’s economic prospects.

Indonesia saw an 11 p.p. increase, and in big developing economies like Brazil and India, the general level of optimism is still quite high.

In some ways, it’s no surprise that people in developing economies are more optimistic about their economic prospects. Living standards are generally rising in many of these countries, and more opportunities open up as the economy grows. Even in the most pessimistic African country surveyed, South Africa, the majority of people still see improving circumstances in their near future. In Kenya and Nigeria, an overwhelming majority are optimistic.

Diverging Outcomes

One major prediction that experts agreed on for the year ahead is that economic outcomes will begin to diverge between countries with differing levels of vaccine access.

While this doesn’t seem to have affected attitudes towards economic optimism yet, it remains to be seen how this will play out as the year progresses.

Where does this data come from?

Source: 2022 Edelman Trust Barometer

Data notes: This data is derived from Edelman’s annual Trust Barometer survey, which includes 30,000+ respondents in countries around the world.

Continue Reading

Subscribe

Popular