Big money managers must disclose their stock positions every quarter, giving small investors like you and me a peek into their portfolios. Based on his firm's third-quarter 13F SEC filing, multibillion-dollar fund-manager Ken Fisher's holdings include a diversified mix of stocks, with significant weightings in the health care, financial services, and technology sectors.
Fisher's favorites Drugmaker Pfizer Inc. (NYSE:PFE) represents Fisher's largest holding in the health care space. The New York-based pharmaceutical giant acquired several companies during the past few years, but Pfizer is currently divesting its noncore businesses. For instance, Pfizer launched an IPO of Zoetis Inc (NYSE:ZTS), once its animal health business, earlier this year. As Pfizer becomes a smaller company by offloading its non-pharmaceutical-related businesses, successful pipeline products should have a greater impact on the company's growth and profitability. The maker of Viagra, Celebrex, and Lipitor represents more than 2% of Fisher's portfolio.
Fisher's largest financial-services-sector holding is American Express Company (NYSE:AXP). Boasting a distinctive business model, American Express relies heavily on merchant fees and the annual fees it charges its cardholders. By comparison, its credit-card-issuing counterparts generate most of their revenue by charging interest on loan balances that customers carry from month to month.
American Express is also able to charge higher fees to merchants than other providers, such as Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA), for two primary reasons. First, American Express cardmembers spend three to five times annually what is spent on other cards. This higher level of cardmember spending is driven by a focus on travel and entertainment, a large base of small business and corporate cardmembers, and a more affluent individual cardmember base. Second, merchants are willing to pay more, as American Express can offer them valuable information, such as marketing data on spending behavior among well-heeled consumers worldwide.
Apple Inc. (NASDAQ:AAPL), which represents just less than 2% of Fisher's fund, is its largest technology holding. Fisher loaded up on stock of the iDevice maker in the third quarter of last year. Even though Apple has lost market share to Google Inc (NASDAQ:GOOG)'s Android operating system, Fisher likely feels Apple remains attractive due to its ability to innovate and produce sought-after solutions, as well as its international growth potential.
For example, net sales to Asia-Pacific were up 47% in fiscal 2012. This segment represented 21% of Apple's total net sales in 2012. By comparison, four years ago the company didn't even break out this region as a separate operating segment. In addition, the iPhone wasn't launched in China until 2012, which will provide momentum for Apple. Overall, China harnesses significant promise as incomes and wealth grow, and Apple extends its reach in that country through wireless carrier-relationships and an increased retail store presence.