What the experts say about Trump's stock portfolios
Donald Trump disclosed his financials last week, and Americans now know what the Republican presidential hopeful/celebrity mogul holds in his stock portfolios.
Donald Trump disclosed his financials last week, and Americans now know what the Republican presidential hopeful/celebrity mogul holds in his stock portfolios.
Are they good investments?
Professional investors opined on Trump's holdings, most of which are blue-chip companies found in the Standard & Poor's 500 index. His total investments are worth at least $78 million, according to his Federal Election Commission filings. That's spread over brokerage accounts with Barclays, JPMorgan, and Oppenheimer, and two with Deutsche Bank.
"Confused, messy. Not well organized," Daniel Wiener, an expert in low-cost Vanguard mutual funds, says after viewing Trump's holdings. "With so many broker accounts, he's overpaying in fees."
The Donald's major equity holdings show nearly 100 big-name blue chips: AT&T, Apple, GE, Conoco Phillips, Verizon, Wal-Mart, Bristol Myers Squibb, Altria, JPMorgan Chase, Caterpillar, and Morgan Stanley, to name a few. Many throw off dividends as income.
"It's vanilla. It's bland, very liquid. It's not speculative at all," says James Nolen, senior vice president of equity trading at Drexel Hamilton in Center City.
As is true of many One Percenters, Trump's biggest single investment is in a hedge fund: BlackRock's Obsidian fixed-income fund, disclosed at between $25 million and $50 million. Obsidian has returned roughly 11 percent annually since its inception in 1996.
Trump also has invested $1 million to $5 million in two Angelo, Gordon & Co. hedge funds (AG Diversified Credit Strategies and AG Eleven Partners), three funds run by John Paulson (Paulson Partners, Paulson Advantage Plus, and Credit Opportunities), and MidOcean Credit Opportunities Fund.
He invested up to $5 million in Baron mutual funds (Baron Small Cap, Baron Focused Growth, Baron Real Estate, Baron Growth, and Baron Partners.)
Trump also maintains $5 million to $25 million in his Capital One checking and savings accounts, an additional $1 million to $5 million in a JPMorgan Chase account, and $1 million in a money-market account at Deutsche Bank.
In commodities, Trump owns $100,000 to $250,000 in physical gold and a $100,000-to-$250,000 position in the GAMCO Global Gold Natural Resources & Income Trust.
"There's no rhyme or reason as to how these different accounts are invested," Wiener says.
For instance, Trump's JPMorgan account sold Apple for a capital gain of between $1 million and $5 million. But he still holds Apple in his Oppenheimer and Deutsche accounts.
"He's set up on the dividend side. The stocks pay income to own them long term," says Nolen. High dividend payers include AT&T, with a 5.3 percent dividend yield, and Verizon, which yields 4.7 percent.
And although Comcast cut its broadcast ties to Trump for his comments about Mexican immigrants, he still owns Comcast shares worth about $500,000.
What strikes investment advisers most is that Trump's real interest is building his licensing and brand name - and a presidential run adds serious juice to that value.
Nolen is convinced that Trump has no interest in being president but rather in selling himself.
Explains Nolen: "He's talking his own book."
215-854-2808 @erinarvedlund