Hi there investor!👋🏻
In this article, we will review what the top global quality investors did in the previous quarter.
This is a good exercise to spark ideas and get inspiration from some of the best to do it.
Let’s get into it 👇🏻
Terry Smith’s Fundsmith
Terry Smith is one of the UK’s most respected fund managers, following a "buy good companies, don’t overpay, do nothing" philosophy. His fund, Fundsmith, invests in high-quality, capital-efficient businesses with strong pricing power and sustainable growth. Smith avoids overtrading, preferring to let great companies compound over time. His approach is often compared to Warren Buffett and Nick Train.
After a few years of underperformance, money is likely flowing out of Fundsmith. The most notable reductions:
Meta Platforms were reduced by 6.36%, to 11.39% of the portfolio
Microsoft was reduced by 10.34%, to 11.12% of the portfolio.
Visa was reduced by 16.66%, to 6.23% of the portfolio.
Fortinet was reduced by 15.69%, to 3.44% of the portfolio.
Terry Smith is taking profit from some of his largest winners. Meta Platforms has been an incredible investment for him (and anyone else who has held it for the past few years).
I believe Smith is seeing redemptions from his fund as he has underperformed the reference index for the past 3 years (despite having a superior long-term track record). Investors are short-term focused, and 3 years of underperformance is enough for many to withdraw their funds.
Valley Forge Capital Management
Valley Forge Capital is a fundamentals-driven investment firm focused on owning high-quality businesses with strong competitive advantages. It prioritizes capital preservation, long-term compounding, and disciplined valuation.
Its strategy revolves around buying companies with durable cash flows, exceptional management, and consistent profitability, aiming for superior risk-adjusted returns.
Notable changes:
Trimming Intuit by 9.58%, to 5.57% of the portfolio.
New position in Equifax, 0.81%.
New position in MSCI, 0.79%.
An uneventful Q4 for VFCM, but the two new positions are interesting. The firm is very selective in what businesses they allow into the portfolio.
We’ve covered MSCI here before — a high-quality compounder. It will be interesting to see if he continues to add to this position.
Bill Ackman’s Pershing Square Capital Management
Bill Ackman is a high-profile activist investor known for bold, high-conviction bets. Through Pershing Square, he takes large, concentrated positions in undervalued companies and pushes for strategic changes to unlock value.
His approach focuses on deep fundamental research with activist pressure, often involving public campaigns to drive corporate changes. His past plays include Canadian Pacific, Chipotle, and Howard Hughes Corporation, along with a famous (and costly) short on Herbalife.
Notable changes:
Ackman increased his position in Brookfield by +6.59%, now at 15.89%.
Chipotle Mexican Grill was reduced by -14.44%.
The Nike position was increased by 15.29%.
Hilton Worldwide was reduced by -26.18%
Seaport Entertainment Group was added with a 1.11% position.
Bill Ackman’s Q4 saw him making multiple moves. He continues to add to Brookfield (An interesting investment case), and Nike. While reducing his position in Hilton Worldwide and Chipotle Mexican Grill.
CMG has not been the strongest stock to own lately, and Ackman might see some short-term pain ahead, hence trimming the position. On the other hand, Hilton Worldwide has been on fire over the last few years — I’m assuming he is locking in some profits here.
Christopher Bloomstran’s Semper Augustus
Christopher Bloomstran is a deep-value investor who emphasizes intrinsic value, capital allocation, and long-term compounding.
His firm, Semper Augustus, takes a research-intensive approach, investing in businesses with strong competitive positions, excellent management, and durable financials. He is a known admirer of Berkshire Hathaway and applies similar principles of patience and compounding wealth over decades.
Notable changes:
Berkshire Hathaway was reduced by ~5.41% (Net)
Dollar Tree was increased by 62.13%, to 10.50% of the portfolio.
Dollar General was reduced by 28.99%, to 8.29% of the portfolio.
Valero Energy was increased by 61.49%, to 4.14% of the portfolio.
The most interesting move from Bloomstran this quarter is his increase in Dollar Tree and reduction in Dollar General. To me, this clearly indicates that he prefers Dollar Tree and believes the opportunity here is larger than in Dollar General.
Dollar Tree has fallen from a high of +$170 in 2022 to the current share price of $74. Bloodstran obviously sees some mispricing in this asset.
Chris Hohn’s TCI Fund Management
Chris Hohn runs TCI, a hedge fund that follows an activist, high-conviction strategy. He seeks undervalued companies with the potential for operational improvement, often pressuring management to enhance efficiency, governance, and shareholder value. Hohn’s fund is long-term oriented with a concentrated portfolio, and he has been a strong advocate for climate-conscious investing.
Notable changes:
Trimming 4.53% from his largest position GE Aerospace, now 18.09% of the portfolio.
Adding +16.71% to his Microsoft position, now 13.91% of the portfolio.
Trimming 16.21% to his Canadian National railway, now 7.11% of the portfolio.
Chuck Akre’s Akre Capital Management
Chuck Akre’s investment style is centered around the "three-legged stool" approach—focusing on a business’s exceptional economics, great management, and reinvestment opportunities. Akre Capital specializes in finding compounding machines, companies that can grow intrinsic value over long periods. His portfolio is concentrated, long-term, and high-conviction, with holdings such as Mastercard, Moody’s, and American Tower.
Notable changes:
Trimming multiple key holdings:
Mastercard by 5.53%.
KKR & Co. by 9.74%
Moody’s Corp by 8.44%
American Tower Corp by 9.07%
Carmax by 48.55%
DigitalBridge by 41.85%
The only notable purchase this quarter was Costar where they added +4.25% to the position. Costar is a favorite among super investors due to its superior business model, profitability, and multi-year growth story. The stock price has however stagnated somewhat in recent times.
Francois Rochon’s Giverny Capital
Francois Rochon follows a quality-focused value investing approach, inspired by Warren Buffett and Peter Lynch. He looks for businesses with strong competitive advantages, outstanding management, and high returns on capital, aiming to hold them for decades. His philosophy combines art and investing, valuing patience and emotional discipline in building long-term wealth.
Notable changes:
Adding +3.32% to his Berkshire Hathaway position, now 8.38% of the portfolio.
Adding +16.89% to his Alphabet ($GOOG) position, now 5.26% of the portfolio, but trimming his position in GOOGL 0.00%↑ by 26.01%, now 1.77% of the portfolio.
Adding +25.73% to his Fiserv position, now 4.73% of the portfolio.
Trimming 31.02% to Keysight Technologies, now 1.95% of the portfolio.
The most interesting move made by Rochon in Q4 was his 25.73% increase in his position at Fiserv. This is a stock not owned by many other super investors, and the stock price has rocketed more than 100% since 2024.
Rochon usually adds on weakness because he is very focused on valuation. So to see him add at these elevated levels indicates to me that he is seeing a major upside in this business moving forward — a masterpiece as he would put it himself.
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Nice analysis. I frequently look at what these investors are up to too. Although, keep in mind these investments (increases or decreases) are already a few months old. Granted, many of them are long-term holders, but not always. For example Berkshire had a holding in ULTA and the next quarter it was gone.
By the way, I would recommend an interview with Terry Smith, which was done by William Green on the Investors Podcast recently.
To me, Bill Ackman is not a quality investor, nor the growth and value investor.
Sorry to say that.