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.
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.
Amazon.com (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.
Fisher's confidence in these stocks may encourage you to ponder similar positions in your own portfolio.