Billionaire Ken Fisher's Top 3 Stock Picks

Why Fisher likes American Express, Amazon, and Pfizer.

Jan 17, 2014 at 2:59PM

Money managers must disclose their stock holdings every quarter, giving investors like you and I a peek into their portfolios. Based on his firm's fourth-quarter 13F SEC filing, here are multibillion-dollar fund manager Ken Fisher's top three holdings.

Fisher's favorites
The largest single stock holding in Fisher's fund is American Express (NYSE:AXP). Unlike its credit card issuer peers Mastercard (NYSE:MA) and Visa (NYSE:V), which generate the majority of their revenue by charging interest on loan balances that customers carry, American Express relies heavily on merchant fees and the annual fees it charges cardholders. American Express is able to charge higher fees to merchants than its competitors for two key reasons. First, American Express cardholders spend up to five times annually what is spent on other cards. Second, merchants are willing to pay more because American Express is able to offer them valuable marketing data on the spending behaviors of affluent consumers. (NASDAQ:AMZN) is Fisher's second-largest stock holding. Known as the 800-pound gorilla of e-tailing, the company is known for unparalleled product selection, convenience, and market dominance. This will likely continue as the company expands its same-day delivery service and leverages new warehouses situated near cities to accommodate faster shipping times. And of course, investors will be keeping their eyes peeled for drone sightings. In the meantime, Amazon is making serious inroads in its broad cloud-computing service, Amazon Web Services, which provides access to technology infrastructure. In order to deflect competitors like Microsoft (NASDAQ:MSFT) and Rackspace Hosting (NYSE:RAX), Amazon Web Services continues to significantly cut prices. Last summer, the company lowered the price of this service for the 37th time.

Drug maker Pfizer (NYSE:PFE) is Fisher's third-largest single stock holding. The pharmaceutical giant acquired many companies over the past few years. But Pfizer has recently been divesting its noncore businesses. The company sold its nutritional business and spun off its animal-health business, Zoetis (NYSE:ZTS). As Pfizer becomes a smaller company by unloading its nonpharmaceutical businesses, successful pipeline products should have a bigger impact on the company's growth and profitability. Among the promising drugs in development are those for the treatment of different forms of cancer.

Foolish takeaway
Fisher's confidence in these stocks may encourage you to ponder similar positions in your own portfolio.

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Fool contributor Nicole Seghetti owns shares of Microsoft and Pfizer. Follow her on Twitter @NicoleSeghetti. The Motley Fool recommends, American Express, MasterCard, Rackspace Hosting, and Visa. The Motley Fool owns shares of, MasterCard, Microsoft, and Visa. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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