Billionaire Ray Dalio is the founder of one of the world’s largest investment funds, Bridgewater Associates. His stock picks, which we explore below, and his market opinion carry significance. According to financial accountability engine TipRanks, the $10.16 billion fund generated a 12.71% return for investors in the last year. 

Dalio, who made his first successful investment age 12, has made headlines this week with his comments that the Trump era could “ignite animal spirits” and attract productive capital. In a LinkedIn post on Monday, Dalio wrote “By and large, deal-maker businessmen will be running the government. Their boldness will almost certainly make the new four years incredibly interesting and will keep us all on our toes.”

We can gain further insight into the mind of Ray Dalio based on the most recent SEC 13F forms submitted by Bridgewater which reveal the fund’s portfolio picks for the third quarter. The fund’s preference of emerging market ETFs, as well as the SPDR S&P 500 ETF, continues. Dalio’s three major stakes are the VWO ETF, the EEM ETF and the SPY ETF which comprise 30%, 26%, and 23% of his portfolio, respectively.

Vanguard FTSE Emerging Markets ETF (VWO)

Dalio significantly increased his holding in Vanguard by 14.87%. The fund now holds 80,412,854 shares in Vanguard worth an impressive $3.03 billion. TipRanks shows that the shares have actually made a loss since the last quarter of -5.9%, however Dalio is betting that the fund’s outlook is due to improve. Vanguard’s portfolio is dominated by the stocks of mainly tech focused corporations (such as Tencent Holdings Ltd) located in emerging markets, particularly China, Taiwan, Brazil, India and South Africa.

iShares MSCI Emerging Markets ETF (EEM)

Dalio made a major 85.9% addition to his EEM shareholding taking the total shareholding to 70,996,740 shares worth $2.66 billion. Like the Vanguard shares, the EEM shares have also made a loss since the last quarter of -6.78%. With an annual average trailing return of 3.19%, the EEM ETF seeks to track the investment results of an index composed of large- and mid-capitalization emerging market equities.

SPDR® S&P 500® ETF (SPY)

Dalio made a more modest increase to his SPY ETF holding of 6.52%. His shareholding in the US’s first and most popular ETF now stands at 10,887,300 with a value of $2.35 billion. Unlike the emerging markets emphasis of EEM and VWO ETFs, the SPY ETF tracks the American stock market index the S&P 500. With an annual average trailing return of 5.98%, the funds five biggest holdings are Apple, Microsoft, Exxon, Johnson & Johnson and Amazon. 

 

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