Stanley Druckenmiller is often known for working closely with George Soros to "break the bank of England" when they shorted the pound and crashed it in 1992.
However, Druckenmiller is a highly accomplished investor in his own right, and his Duquesne Capital Management fund is one of the best-performing funds in history. It grew from $1 million in 1981 to $23 billion by the time he closed it in 2010, generating an average annual return around 30%.
Today, Druckenmiiller runs a family fund, Duquesne Family Office, and you can still track his moves through quarterly 13-F filings with the SEC. It might surprise you to learn that his portfolio is highly concentrated with his top four stocks making up close to half of his holdings.
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1. Microsoft
Microsoft (MSFT 1.75%) was Duquesne's biggest holding as of the end of the fourth quarter, making up 12.2% of the firm's portfolio at $408.4 million, or 1,086,120 shares.
Duquesne added 68,860 shares of Microsoft in the fourth quarter, reinforcing his high conviction stance on the tech giant, and the value of that stake, assuming he's held it, has grown further this year.
Druckenmiller hasn't commented on why he owns Microsoft, but there are many good reason to own the stock. Microsoft looks like a no-brainer pick to capitalize on the artificial intelligence (AI) boom thanks to its partnership with OpenAI, its diversification across multiple business areas, and its leading position in enterprise software.
2. Coupang
Druckenmiller's second-biggest holding might surprise you. It's Coupang (CPNG 1.21%), the South Korean e-commerce giant that resembles Amazon in a number of ways.
The firm finished the year with Coupang making up roughly 11% of the portfolio, or a $371 million position. Druckenmiller was bullish on Coupang in the fourth quarter, buying more than 2 million shares of the e-commerce company.
Coupang is an intriguing opportunity as it has a lot of room for growth as it expands to new markets and adds new product lines. The stock also looks well-priced for its growth potential, and Coupang is leveraging AI to automate its warehouses.
3. Nvidia
Druckenmiller originally bet on the AI gold rush by going long on Nvidia (NVDA 3.58%) in the fourth quarter of 2022. But he began to taper that bet in the fourth quarter, selling 257,162 shares of the AI chip leader. Nonetheless, the company remained Duquesne's third-largest holding at the end of 2023.
The 617,494-share position represented 9.1% of the total portfolio. Druckenmuller also held call options for nearly 500,000 shares of the stock, giving his firm additional upside exposure.
Nvidia has become a popular bet among both professional and retail investors. The business has exploded over the past year as the stock most closely associated with the generative AI revolution.
Druckenmiller seemed to believe Nvidia's rally had gone far enough, though selling the stock in Q4 has proved to be shortsighted as shares are up about 75% this year.
4. Eli Lilly
Finally, Druckenmiller's fourth-largest holding doesn't hail from the tech sector, but Eli Lilly (LLY 3.19%) is one of the world's biggest pharmaceutical companies.
His firm held $235 million of shares at the end of last year, though he did sell down about 11% of his position during the fourth quarter.
Eli Lilly's Mounjaro weight-loss drug has been a driver of the stock's surge over the past year. It's now the company's top-selling drug with $1.8 billion of revenue last quarter.
Management and analysts have big expectations for Mounjaro. If the weight-loss drug continues to follow its current trajectory, the stock should only gain from here.
Should you follow Druckenmiller's lead?
Following an investor without doing your own research, even a world-renowned one, is a bad idea. An ultra-wealthy family fund like Duquesne has resources and strategies at its disposal that aren't available to individual investors.
That said, its top holdings can still shine a light on interesting companies. And in this case, Druckenmiller reminds us that even mature, established tech giants like Nvidia and Microsoft can deliver market-beating returns thanks to their ability to capitalize on secular tailwinds like AI.
The Duquesne Family Office's next 13-F (for Q1 2024) comes out in mid-May.
