Ray Dalio’s Portfolio 2021 – Top 20 Positions
RAY DALIO PORTFOLIO MARCH 31, 2021
Ray Dalio is the Founder of Bridgewater Associates. From 1975 he grew his fund into the fifth most important private company in the US. As of June 2021, his hedge fund manages roughly $150 billion in total assets. According to Forbes, Ray Dalio is the 88th richest person in the world with a net worth of approximately $20.3 billion.
Bridgewater Associates’ average return over the last 28 years has been 12% per year. That is almost double the average return of the S&P 500 which is about 7% after inflation.
As Ray Dalio is known for diversification and has many positions on September 30, 2021, we will focus our attention on Ray Dalio’s portfolio 2021 top 5positions. In the table below you can see the top five positions he is currently holding.
Ray Dalio’s Portfolio Q3 2021 – Top positions
These positions are as follows:
| Stock | Value ($) | % of total portfolio | Shares | Price per share* |
| Vanguard FTSE Emerging Markets Index Fund ETF Shares (VWO) | 1,172,526,000 | 6.42% | 23,445,821 | 50.0 |
| iShares MSCI Emerging Markets ETF (EEM) | 1,014,567,000 | 5.55% | 20,138,284 | 50.4 |
| iShares Core MSCI Emerging Markets ETF (IEMG) | 849,827,000 | 4.65% | 13,760,158 | 61.8 |
| SPDR S&P 500 ETF Trust (SPY) | 844,378,000 | 4.62% | 1,967,605 | 429.1 |
| Walmart Inc. (WMT) | 700,487,000 | 3.84% | 5,025,736 | 139.4 |
| PROCTER AND GAMBLE CO | 655,318,000 | 3.59% | 4,687,538 | 139.8 |
| ALIBABA GROUP HLDG LTD | 487,119,000 | 2.67% | 3,290,232 | 148.1 |
| JOHNSON & JOHNSON | 444,777,000 | 2.44% | 2,754,036 | 161.5 |
| COCA COLA CO | 439,219,000 | 2.40% | 8,370,857 | 52.5 |
| PEPSICO INC | 402,977,000 | 2.21% | 2,679,193 | 150.4 |
Emerging Market ETFs make more than 15% of Ray Dalio’s portfolio
Vanguard FTSE Emerging Markets Index Fund ETF Shares (VWO) is the biggest holding of Ray Dalio’s portfolio. That makes sense since he is the king of diversification and believes that in near future small and medium-sized companies will benefit globally. Moreover, he often says how China is a rising power that currently competes with the United States. You can read more about that in his book Principles. Believing that, he invests in both China and United States with much diversification. VWO is the perfect solution for his strategy as it invests in China, Brazil, Taiwan, and South Africa.
Looking at his next two investments, the same pattern is visible, which is an aggressive investment strategy in emerging markets around the world. As a result, Dalio’s portfolio is well diversified into the emerging market accounts for as much as 15% of the total portfolio.
Dalio reduces diversification in America
In fourth place on the Ray Dalio portfolio in 2021 is the famous Spider ETF that tracks the S&P500 index. Apparently, Dalio believes that the American market is overvalued and has been constantly reducing its share in it for the last year and a half in a row.
Increased stake in Alibaba
We could see many investors coming out of an Alibaba stock this quarter as it fell only further. Dalio invested almost twice as much in Alibaba in Q3 2021. The advantage of Ray is that he knows the Chinese market better than other investors and may know what he is doing here. Products of these companies are always in demand, no matter how well the economy is at the moment.
Strong consumer staples positions
Ray Dalio continues to build his position in the consumer staples industry. This industry tends to do well in high inflation as companies in such industries can pass its costs to consumers who have no choice but to buy at higher prices. With that in mind, I would say Ray Dalio builds his positions in inflation-resistant industries as he expects higher inflation in the next few years. This quarter he bought more of Johnson & Johnson, Coca Cola and Pepsico. More about these particular companies you can read in below – Q2 Analysis.
Ray Dalio’s Portfolio Q2 2021 – Top 20 Positions
| Stock | Value ($) | % of the total portfolio | Shares | Price per share* | Change of shares | Add/decrease |
| SPDR S&P 500 ETF TR (TR UNIT) | 845,445,000 | 5.42% | 1,975,061 | 428.06 | -1,163,138 | decrease |
| WALMART INC (COM) | 736,488,000 | 4.72% | 5,222,576 | 141.02 | 1,631,636 | add |
| VANGUARD INTL EQUITY INDEX F (FTSE EMR MKT ETF) | 644,833,000 | 4.14% | 11,873,186 | 54.31 | 783,391 | add |
| PROCTER AND GAMBLE CO (COM) | 641,348,000 | 4.11% | 4,753,187 | 134.93 | 1,534,557 | add |
| JOHNSON & JOHNSON (COM) | 465,078,000 | 2.98% | 2,823,106 | 164.74 | 1,113,211 | add |
| COCA COLA CO (COM) | 445,444,000 | 2.86% | 8,232,188 | 54.11 | 2,565,360 | add |
| PEPSICO INC (COM) | 395,479,000 | 2.54% | 2,669,091 | 148.17 | 880,614 | add |
| COSTCO WHSL CORP NEW (COM) | 333,656,000 | 2.14% | 843,268 | 395.67 | 280,289 | add |
| MCDONALDS CORP (COM) | 322,616,000 | 2.07% | 1,396,667 | 230.99 | 456,274 | add |
| ALIBABA GROUP HLDG LTD | 321,814,000 | 2.06% | 1,419,060 | 226.78 | 16,340 | add |
| ISHARES INC (CORE MSCI EMKT) | 284,009,000 | 1.82% | 4,239,575 | 66.99 | 471,236 | add |
| ISHARES TR (CORE S&P500 ETF) | 277,545,000 | 1.78% | 645,574 | 429.92 | 221,073 | add |
| SPDR GOLD TR (GOLD SHS) | 267,762,000 | 1.72% | 1,616,628 | 165.63 | -115,769 | decrease |
| STARBUCKS CORP (COM) | 234,072,000 | 1.50% | 2,093,483 | 111.81 | 693,502 | add |
| DANAHER CORPORATION (COM) | 230,221,000 | 1.48% | 857,883 | 268.36 | 414,963 | add |
| LAUDER ESTEE COS INC (CL A) | 218,273,000 | 1.40% | 686,222 | 318.08 | 215,993 | add |
| TARGET CORP (COM) | 216,272,000 | 1.39% | 894,649 | 241.74 | 323,117 | add |
| ABBOTT LABS (COM) | 208,307,000 | 1.34% | 1,796,830 | 115.93 | 708,381 | add |
| ISHARES TR (CHINA LG-CAP ETF) | 171,409,000 | 1.10% | 3,699,732 | 46.33 | -89,408 | decrease |
| ISHARES TR (IBOXX INV CP ETF) | 144,419,000 | 0.93% | 1,074,865 | 134.36 | -22,514 | decrease |
*Price per share is the stock price on the date of the portfolio.
As I mentioned, Ray Dalio loves diversification, and that can be seen in his positions. The largest position in Ray Dalio’s portfolio 2021, of course, is the ETF that follows the 500 largest U.S. index. publicly traded companies – SPDR S&P 500.
Interestingly, in Q2 2021, Ray Dalio reduced this position by 1,163,138 shares. Previously, it was above 10% of the total portfolio, now it makes a little more than 5%. This could point to the fact that the SP500 is currently overpriced.
[finviz ticker=SPY link=true]
How much Ray Dalio has reduced the SP500 position in the last year can be seen in the table below.
| 13F date | Shares | % change |
| Jun-20 | 5,045,646 | – |
| Sep-20 | 3,969,472 | -21% |
| Dec-20 | 3,686,443 | -7% |
| Mar-21 | 3,138,199 | -15% |
| Jun-21 | 1,975,061 | -37% |
The position was reduced from 5,045,646 shares to 1,975,061 shares, which decreased 60.86% in the last year. This points to the fact that Ray Dalio sees better opportunities in some other positions, which we will go through below.
Increased Stake in Emerging Markets
Most experts agree the term “emerging market investments” refers to countries or regions undergoing fast economic growth. Some of these countries are India, Mexico, Russia, Pakistan, Saudi Arabia, China, and Brazil.
In short, an emerging market economy is currently transitioning from a less developed and low-income industry towards a modern economy with a higher standard of living.
Ray Dalio’s portfolio 2021 has three interesting positions in emerging markets that belong to the top 20 positions in the portfolio. Top Ray Dalio’s emerging market positions can be seen in the table below
| Position | Stock | Value ($) | % of the total portfolio | Shares | Price per share* | Change of shares | Add/decrease |
| 3 | VANGUARD (VWO) | 644,833,000 | 4.14% | 11,873,186 | 54.31 | 783,391 | add |
| 10 | ALIBABA GROUP | 321,814,000 | 2.06% | 1,419,060 | 226.78 | 16,340 | add |
| 11 | ISHARES Core Msci (IEMG) | 284,009,000 | 1.82% | 4,239,575 | 66.99 | 471,236 | add |
| 19 | ISHARES CHINA LARGE CAP (FXI) | 171,409,000 | 1.10% | 3,699,732 | 46.33 | -89,408 | decrease |
Dalio increased 3 positions while decreasing one in emerging markets.
FTSE Emerging Markets ETF (VWO)
The third-largest position in Bridgewater Associates’s portfolio is in Vanguard FTSE Emerging Markets ETF (VWO). This ETF tracks the index that invests in stocks of companies located in emerging markets around the world, such as China, Brazil, Taiwan, and South Africa.
Furthermore, ETF has a high potential for growth, but also high risk. Share value may swing up and down more than that of stock funds that invest in developed countries, including the United States.
For Dalio, using this ETF to diversify his portfolio in emerging markets for his long-term goals sounds like a good option.
[finviz ticker=VWO link=true]
iShares Core MSCI Emerging Markets ETF (IEMG)
The iShares Core MSCI Emerging Markets ETF seeks to track the investment results of an index composed of emerging market equities.
Its purpose is similar to that of Vanguard’s ETF, and that is to diversify the portfolio for long-term growth.
[finviz ticker=IEMG link=true]
Ray Dalio Invests in Both American and Chinese Systems and Markets
Ray believes that both of these countries have opportunities and risks and are likely to compete with each other in the future and diversify. Therefore, in his portfolio, we can find both of these country’s companies.
“To understand what’s going on you need to understand that China is a state capitalist system which means that the state runs capitalism to serve the interests of most people and that policy makers won’t let the sensitivities of those in the capital markets and rich capitalists stand in the way of doing what they believe is best for the most people of the country. Rather, those in the capital markets and capitalists have to understand their subordinate places in the system or they will suffer the consequences of their mistake“
Ray Dalio, co-chief investment officer of Bridgewater Associates
China has accomplished enormous growth in one generation. It has gone from a backward third-world country to an economic super-power in 30 years. It’s now the second economy in the world with $12.238 trillion, after the United States which has $19,485 trillion.
Given the huge growth that China has had in recent years, it is no wonder that Ray is diversifying part of its investments in Chinese companies. Two positions in his portfolio relate strictly to China. Investment in Alibaba and the ETF that accompanies large-cap stocks.
Alibaba (BABA)
In Q2 2021, Ray’s hedge fund has added more shares of the tech giant Alibaba (BABA). Alibaba stock has been on a sharp downtrend since November even with amazing fundamentals like strong earnings and sales growth. Increased regulatory risks have weighed on Alibaba stock and other Chinese stocks in recent months.
[finviz ticker=BABA link=true]
iShares China Large-Cap ETF (FXI)
Another interesting investment vehicle from Ray Dalio’s Bridgewater Associates fund is an ETF that tracks the investment results of an index composed of large-capitalization Chinese equities that trade on the Hong Kong Stock Exchange. This ETF has access to 50 of the largest Chinese stocks in a single fund.
However, in Q2 2021, Dalio reduced this position by 89,408 shares and this position now accounts for 1,1% of the fund’s total portfolio.
[finviz ticker=FXI link=true]
Ray Dalio’s Portfolio 2021 Has Large Investments in Consumer Staples Companies
The Consumer Staples Sector comprises of companies whose businesses are less sensitive to economic cycles. It includes manufacturers and distributors of food, beverages and tobacco. Also, companies that produce non-durable household goods and personal products. Furthermore, it includes food & drug retailing companies as well as hypermarkets and consumer supercenters.
Ray’s fund Bridgewater Associates increased stakes in most of his consumer staples products. The biggest positions are Walmart, P&G, Johnson and Johnson, Coca-Cola, Pepsico, Costco Wholesale Corporation, Mc Donald’s.
Walmart
The largest single position in consumer staples, containing $736 million, is in Walmart. Ray is betting big on Walmart’s success. In the last quarter, Q2 2021, Ray Dalio’s portfolio 2021 has increased by 1,631,636 shares.
Walmart (WMT) is a U.S.-based multinational retail corporation that operates as a chain of discount department stores and a chain of warehouse stores. Walmart is known for being the largest company in the world by revenue. It is also the world’s largest private employer with approximately 2.2 million employees. The company has over 11,500 locations across the globe.
It has increased revenue, profit, and earnings per share (EPS) steadily for the past 20-plus years. At the end of its latest fiscal year, the company had almost $18 billion of cash. Over the next five years, Walmart is expected to grow earnings at an average annual rate of more than 5%.
In terms of online retail competition, which is growing stronger, Walmart stands out with its low prices and the experience it offers to customers. The company continuously invests in technology.
In 2021 Walmart remains a stable company and that is what Ray sees in him, a big and stable long-term growth company.
[finviz ticker=WMT link=true]
Procter & Gamble
Procter & Gamble stock has been one of the worst performers in Q1 2021 of the S&P 500. It dropped by more than 10% in early March and is now on a similar level as in August 2020.
Although, companies in sectors such as consumer staples were in a favorable position during the pandemics. P&G has shown growth to a different level. Revenue increased by 7,3% in the last financial year, which ended on June 29, 2021.
Procter & Gamble’s valuation is also important, so investors should note that PG has a P/E ratio of 25.19 right now. Compared with the industry average P/E of 23.98, it can be concluded that P&G is selling at a premium price.
[finviz ticker=PG link=true]
Johnson and Johnson
Johnson and Johnson‘s largest business is pharmaceuticals accounting for 55% of the total revenue. The second and third-largest source of income is from medical devices and consumer health which make up about 25% and 20%.
The business is well diversified which provides stability in all economic cycles. Stability has allowed the company to pay dividends continuously for the past 59 years.
Another thing Johnson & Johnson is famous for is acquisitions. The company recently acquired medical device companies bringing robotics and data science to the operating room. In 2019, it acquired both Auris Health and Verb Surgical.
[finviz ticker=JNJ link=FALSE]
Coca-Cola
Everyone has heard of Coca-Cola. Almost everyone has tried it. The company is massive, generating $33 billion in revenue and $9 billion in operating income in 2020.
Coca-Cola is recognized by investors who like solid dividends and conservative long-term growth. Additionally, Coca-Cola suffered a drop in revenue and net income in 2020, but this year is predicted to surpass 2019 in growth.
Furthermore, Coca-Cola has a lot of beverage brands under its belt. In addition to selling soda products, it also sells beverages such as lemonade, unsweetened and minimally sweetened tea, milk, water, and so on. That broad portfolio allows Coca-Cola’s business to thrive even as consumer preferences shift over time.
[finviz ticker=KO link=false]
PepsiCo
Another consumer staple stock pick from Ray Dalio is PepsiCo. This stock can be a great addition to any long-term portfolio. They are known to hold up well in recessions and provide consistent dividend increases over the years. PepsiCo is a well-known brand name company that delivers steady gains and strong earnings on a steady basis.
The global snack and beverage giant owns some of the most popular brand names in the world and is seeing a nice rebound in the areas of its business that were impacted by the pandemic. The stock has over 49 years of dividend growth and a great balance sheet, it’s a very attractive option for investors interested in consumer staples.
[finviz ticker=PEP link=false]
Costco Wholesale Corporation
Costco Wholesale Corporation is a worldwide operator of membership warehouses and e-commerce websites. The company manages to raise revenue and operating income in all time periods. It offers high-quality goods at reasonable prices. However, stock performance compared to the SP500 has been slightly worse in the last year but has beaten it in the last 5 years.
McDonald’s
Another strong business that found itself in the top position in Ray Dalia’s portfolio is the famous McDonald’s. McDonald’s seems to have returned to 2019 levels with revenue and net income. Revenues are expected to be $23 Billion by the end of 2021 and revenues $9 Billion
McDonald’s has a strong brand name. Nearly 70 million people visit one of its stores every day. The company has 39,198 restaurants and more than 90% are franchise-owned.
Many investors see McDonald’s fast-food business as very competitive and highly saturated. In addition, with the emergence of new trends and increasing interest in a healthier diet, it just feels as if McDonald’s faces one too many challenges.
Either way, Dalio sees Mcdonald’s as a good business at this time. No wonder, given the strong brand that has had a constant dividend payment since 1976. Sounds like the perfect company for conservative and diversified investment.
[finviz ticker=MCD link=false]
Books Written by Ray Dalio
Ray Dalio often says that he is currently in the phase of passing on his knowledge to others. In his interviews, he highlights some books that are worth reading, and he is the author of several of them. In the next part of the post, you will be able to find books that Ray Dalio recommends or has written with my reviews.
Principles: Life and Work
Written by Ray Dalio himself in 2017. In this book Dalio writes with a strong emphasis on easy-to-follow outlines and visuals that reinforce the storyline, making it even more actionable and easy to reapply to one’s life or work.
One of the biggest things he talks about is brutal honesty, and how it makes everyone better. Obviously, you can’t start being brutally honest with everyone, but you can ask others to be brutally honest about you.
Another interesting discussion in the book is about focusing on determining what is true (opposed to what you want to be true).
To conclude, there is plenty of useful and interesting stuff in this book that could help you have a more successful life.
Principles for Success
Another book written by Ray in 2005. Again, in an easy-to-read and entertaining format, Ray lays out principles that helped him become one of the world’s most successful people.
Principles for Success is much simpler than Principles: Life and Work. I think this book is great for young people and children to read or even adults who haven’t yet made time to delve into Principles.
The book has some illustrations that certainly pull kids in. And it is always a good lesson for them to understand that they may make far better decisions in life if they open their minds to other, possibly very valid, points of view.
Both of these books are great. However, I would recommend reading Principles: Life and Work, while Principles for Success which is also a good read, can be a great gift for the younger generation if you want to buy them something useful and of value.
Disclaimer: Everything read in this article is my opinion. Use it for educational & informational purposes only. This post consists of referral links. As an Amazon Associate I earn from qualifying purchases.
