Bill Gates Has Nearly 30% of His $36.6 Billion Portfolio Invested in One of Warren Buffett's Favorite Stocks

The Bill & Melinda Gates Foundation Trust -- the investment vehicle that funds the foundation's charitable work around the globe -- holds a portfolio valued at roughly $36.6 billion today. Nearly 30% of the entire trust -- just shy of $11 billion -- is invested in a single stock, one that also happens to be a favorite of one of history's most celebrated investors, Warren Buffett.

That's not a coincidence. Gates and Buffett have been close friends for more than three decades, and Buffett has served as both a sounding board and something of an investing mentor to the tech billionaire. Buffett even pledged the bulk of his fortune to the Gates Foundation starting in 2006, one of the largest philanthropic commitments in history.

So which stock commands that kind of outsized conviction from both of these billionaire investors?

The stock: Berkshire Hathaway

It's Berkshire Hathaway (NYSE: BRK.B) (NYSE: BRK.A), the sprawling conglomerate Buffett built during six decades of investing. Berkshire stock is by far the foundation's largest holding, more than twice the size of its Microsoft stake.

Over the years, Buffett poured tens of billions of dollars into buying back Berkshire's own shares. Between 2020 and 2024 alone, the company repurchased more than $70 billion worth of its own stock, with Buffett frequently calling buybacks a smart use of capital when the shares traded below intrinsic value.

It's worth noting that Berkshire hasn't repurchased shares since. Buffett doesn't see the stock trading at enough of a discount to justify it. But I think it has as much to do with the stock market at large trading at elevated valuation levels as it does with Berkshire shares specifically.

A sprawling business

Berkshire isn't really a stock in the traditional sense. It's more like a diversified investment fund wrapped inside a corporation. Under Buffett's leadership, the company assembled a huge collection of wholly owned businesses, including insurance (GEICO), railroads (BNSF), energy (Berkshire Hathaway Energy), and dozens of manufacturing and retail operations.

Alongside that, Berkshire holds a public equity portfolio worth hundreds of billions, anchored by major stakes in companies like Apple, American Express, and Coca-Cola.

The $382 billion war chest

Then there's the cash. As of its last disclosure, Berkshire was sitting on a record $382 billion in cash and short-term Treasury bills. That kind of liquidity might seem excessive, and many argue that it is. But it means Berkshire has the firepower to move aggressively when markets sell off, and serious bargains emerge.

That's exactly what Berkshire did in the past. In the aftermath of the 2007-2009 financial crisis, Buffett made several key investments in major institutions like Goldman Sachs and Bank of America that not only helped the companies survive, but also netted Berkshire incredible returns.

In just a few years, Berkshire reaped more than $3 billion in profit from the $5 billion it invested in Goldman Sachs. When Berkshire exercised the warrants it was offered six years after it invested $5 billion in Bank of America, the on-paper profit was a whopping $12 billion.

The big question now, of course, is what happens after Buffett. Although the legendary investor remains the board chairman, he stepped down as chief executive officer of Berkshire at the end of 2025, handing over the reins to his successor, Greg Abel.

Image source: Getty Images.

There will definitely be a period of adjustment, but the bulk of that has already happened. This transition has been in the works for years, with Abel calling the shots at Berkshire for some time now.

Abel has deep operational experience running Berkshire's energy and utility businesses, and the company's decentralized structure -- where individual subsidiaries largely run themselves -- means the day-to-day machine doesn't depend on any one person. Buffett built Berkshire to outlast him, and so far, the market seems to believe it will.

A long-term wealth builder

The bears will point to Berkshire's underperformance in recent years, and that's totally fair. It's one of the stock's primary issues. But I see Berkshire more as a hedge and a great way to balance your portfolio if it's tech-heavy, as many are. When the market corrects itself -- or worse -- Berkshire has all the ammunition it needs to execute, just as it did in 2008.

It's core to the Gates Foundation's portfolio for a reason. Berkshire isn't flashy, and it won't deliver the explosive upside of a high-flying tech stock. But it is the sort of long-term wealth builder that not only pays off over time, but helps you sleep at night.

Bank of America is an advertising partner of Motley Fool Money. American Express is an advertising partner of Motley Fool Money. Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Berkshire Hathaway, Goldman Sachs Group, and Microsoft. The Motley Fool has a disclosure policy.