Ray Dalio Is Putting His Money Where His Mouth Is

Ray Dalio was insanely bullish about emerging markets and gold at the beginning of March. Here is what we wrote about his thoughts:

“US Equities first are comparatively cheap but more importantly flows are beneficial to them,” Dalio said.

He thinks most currency devaluations are bullish. Dalio expects emerging market funds, like Sovereign Wealth Funds (SWFs), that invest in bonds will shift into equities and these capital flows will benefit equities.

He’s bullish about US equities but he’s more bullish about emerging market equities and bonds. “Portfolios have too much concentration in developed countries’ stocks and bonds relative to other assets,” said Dalio. “The key thing is going to be diversification. Most investors have too much dollar denominated assets or too much of their portfolio in developed countries. I don’t think that they have typically much gold in their portfolio. Gold is a form of money…The main theme now for investors is that if they diversify their assets into other assets, I think other assets will perform better. It will also lower the risk of their portfolio.”

Recently Ray Dalio’s Bridgewater filed its 13F form with the SEC. Bridgewater increased its emerging markets bets by around 8% since the end of December. Ray Dalio had more than $750 Million in Vanguard International Equity Index Funds (VWO) at the end of March. He also had more than $500 Million in iShares Emerging Markets ETF (EEM). He didn’t have any of the popular gold ETFs or gold miners ETFs.

Ray Dalio trimmed his MSFT bets by 8% despite the decline in Microsoft’s stock price. Microsoft is still the largest stock position in Dalio’s portfolio. Ken Fisher’s Fisher Asset Management, Jean-Marie Eveillard’s First Eagle Investment Management, Boykin Curry’s Eagle Capital, Bill Miller’s Legg Mason, and Phill Gross and Robert Atchinson’s Adage Capital had the largest positions in Microsoft among the 300+ funds we follow.

Ray Dalio’s second largest stock holding is General Electric (GE). Bridgewater boosted its holdings by 20% during the first quarter. D.E. Shaw and Bruce Berkowitz’s Fairholme are the largest holders of GE. Sandy Nairn’s Edinburgh Partners, James Dinan’s York Capital, Warren Buffett’s Berkshire, and Steve Cohen’s SAC Capital had at least $100 Million in GE at the end of March.

Dalio’s two largest new stock positions are Motorola Solutions (MSI) and Costco Wholesale (COST). Warren Buffett, Andreas Halvorsen, Bruce Kovner’s Caxton, SAC’s Sigma Capital, and Richard Chilton’s Chilton Investment Company are among the holders of Costco. Here is a summary of  Ray Dalio’s recent portfolio activity: