Best Investors to Follow – Tricks to Increase Your Portfolio
Joy Wallet is advertiser-supported: we may earn compensation from the products and offers mentioned in this article. However, any expressed opinions are our own and aren't influenced by compensation. To read our full disclosure, click here.
There are many roads to being a successful investor. One is to follow the paths of the wealthy and invest in what they invest in.
It can be considered a copycat form of investing and could lead you to the same errors they’re making. But with diversification and continuing to do your homework while following the stock picks of some of the best investors around, you could increase your net worth with less risk.
Follow Warren Buffett for years and you could be rich. Investing in Berkshire Hathaway, the holding company Buffett is the chairman and CEO of has earned a per-share overall gain of 3,641,613% from 1964 to 2021, according to Buffet’s annual letter to investors. The S&P 500, with dividends included, has an overall gain during that same period of 30,209%.
To put it another way, Berkshire Hathaway has a compounded annual gain of 20.1% from 1965 to 2021, or almost double the 10.5% gain of the S&P 500 during that time.
In this article
Why follow the best investors
Warren Buffett is among the best investors to follow, for many reasons. We’ll get into those specifics soon, but basically, it’s because of his track record in investment management. He’s made money for investors.
Not all of the investors we recommend require buying shares of their companies or investing in their funds as part of your financial planning. Some of you can just follow their investments and adapt them to your personal finance strategy. After doing your own homework, you may find some investments are too risky for you.
Some may offer investment advice for a fee or offer low-cost mutual funds, while others offer portfolio management. Again, you shouldn’t feel pressured to pay a hedge fund manager or some other top investor to pick stocks, ETFs, real estate, or other investments for you. You may just want to follow their investments if they make them public.
If nothing else, you can follow their track record and see if it lives up to the hype.
Here are seven of the best investors to follow, along with the costs of doing so through fees they may charge.
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
7 best investors to follow
1. Warren Buffett
Nicknamed the “Oracle of Omaha,” Buffett, 91, is the fifth-wealthiest person in the world with a net worth of $127 billion. One share in his holding company Berkshire Hathaway, which is headquartered in Omaha, Nebraska, traded for $529,000 as of mid-April 2022.
Buffett is a value investor. He looks for companies with solid fundamentals, strong earnings power, and continued growth potential, all while being underpriced with intrinsic value that’s seen through projecting future earnings. He focuses on long-term returns.
He avoids new and unproven companies, likes to see profits reinvested back into a company or redistributed to shareholders through dividends, and he uses a calculation called economic value-added, or EVA. It estimates a company’s profits after the shareholders’ stake is removed through expenditures and raising initial capital.
For new investors who don’t have the expertise to use his analytical tools, Buffett recommends low-cost index funds instead of individual stocks.
Buffett likes to point out that he doesn’t make stock recommendations. But followers who don’t want to buy shares of Berkshire Hathaway can buy its top holdings on their own. As of the end of 2021, the top five holdings in Berkshire Hathaway were:
- American Express Co.
- Apple Inc.
- Bank of America Corp.
- The Bank of New York Mellon Corp.
- BYD Co. Ltd.
2. Carl Icahn
Carl Icahn is the founder and controlling shareholder of Icahn Enterprises, or IEP, a public company and holding company based in New York City. Icahn, 86, has a net worth of $16.2 billion as of mid-April.
Icahn has been one of the most feared investors on Wall Street for 45 years. He has waged proxy fights as a corporate raider, with his latest fight against McDonald’s for its mistreatment of pigs. Icahn is an activist investor as a hedge fund manager who is working on setting his legacy straight through a new HBO documentary called “Icahn: The Restless Billionaire.”
His first hostile takeover was in 1978 of appliance maker Tappan, in which he doubled his initial investment after the company was sold. Icahn’s other corporate takeovers include TWA, RJR Nabisco, Marvel, Lionsgate, Time Warner, Yahoo, and eBay.
His hedge fund has seen some remarkable returns, though the fund has been closed to outside investors since 2011. A stake in Netflix in 2012 delivered a 457% return in 14 months, earning the fund a $2 billion profit.
His company IEP joined the Nasdaq more than 20 years ago and can be bought by investors. It’s a diversified holding company that Icahn owns an 89% stake in. According to Icahn’s analysis, investing in the publicly-traded company about 20 years ago and reinvesting the dividends earned a 2,041% return on investment.
The top five holdings of Icahn Enterprises are:
- Icahn Enterprises
- Cheniere Energy Inc.
- Occidental Petroleum Corp.
- CVR Energy, Inc.
- Bausch Health Companies Inc.
3. George Soros
George Soros is another hedge fund manager, or owner, whose fund can be worth following if you want to invest like the billionaire.
Soros, 91, has a net worth of $8.6 billion. He has donated more than $32 billion to the Open Society Foundations, his philanthropic organization that supports democracy and human rights in more than 100 countries.
He is chairman of Soros Fund Management, a hedge fund he started in 1970. It is a private investment management firm headquartered in New York City and is structured as a family office and formerly as a hedge fund. A family office is a privately held company that manages investments for a wealthy family, with the goal being to grow and transfer wealth across generations.
Soros Fund Management is the primary advisor for the Quantum Group of Funds, a family of funds in international investments. The Quantum Fund had an ordinary yearly return of 30% from 1970 to 2000. It includes ETFs that individuals can invest in.
As a hedge fund manager, Soros’ investment strategy was to make big, highly-leveraged bets on the direction of the financial markets. These include the movements of currency rates, commodity prices, stocks, bonds, and other assets based on macroeconomic analysis. Soros is famous for a single-day gain of $1 billion on Sept. 16, 1992, by short-selling the British pound.
The top five companies Soros owns are:
- NXP Semiconductors NV
- PPG Industries Inc.
- National General Holdings Corp.
- Walt Disney Co.
- Maxim Integrated Products Inc.
4. David and Tom Gardner
You may know brothers David and Tom Gardner best as the founders of The Motley Fool. They started the company in 1993 to help people reach financial freedom. Their investment newsletter on AOL has since grown to their own website, podcasts, books, and premium investing services.
David, 55, and Tom, 54, used their personal portfolio as proof of their investment advice. In the first year, they consistently outperformed Standard & Poor’s Market Index, finishing 40 points ahead of the market.
Their main audience is everyday investors, not institutional investors or hedge funds. The Motley Fool is a stock picking service, and its most-famous premium service is The Motley Fool Stock Advisor which focuses on large-cap stocks. It has beaten the S&P 500 four-to-one in the last 19 years. New stock recommendations are given twice a month, along with alerts on when to buy or sell a stock.
Here are the five best stock picks from the Motley Fool from 2002 to 2022 with their annualized return. Returns are calculated from the date of recommendation to present:
- Amazon: 1,003%
- Netflix: 1,082%
- Tesla: 1,631%
- NVIDIA: 787%
- Booking: 507%
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
5. Cathie Wood
Cathie Wood is the CEO and founder of Ark Invest, an investment management firm with $60 billion in assets. It invests in innovations such as robotics, artificial intelligence, genomics, and self-driving cars, and Wood is one of the biggest boosters of Tesla.
Whatever stocks that Wood, 66, buys, the investment world seems to follow. Her daily stock moves are reported widely, so it should be easy for personal investors to see what she’s doing on Wall Street. Her flagship ETF is the Ark Innovation Fund, with $23 billion in assets and an annual return averaging nearly 45% over the past five years.
Wood’s investment strategy is high-risk, high-reward. She is transparent in her decisions, explaining them in a public newsletter.
The top five companies held by Ark Invest ETFs are:
- Tesla, Inc.
- Teladoc Health
- Coinbase
- Square
- Exact Sciences Corp.
It’s worth noting that Wood’s holdings, along with other investors worth following, can change at any time and it’s worth looking up the latest holdings to see if any have changed.
6. Peter Lynch
Peter Lynch, 78, is partly retired and a philanthropist, so following his portfolio management decisions as manager of the Magellan Fund at Fidelity Investments from 1977 to 1990 isn’t as easily applicable as it was then.
Lynch averaged a 29.2% annual return, consistently more than double the S&P 500 stock market index. The fund he managed was the best performing mutual fund in the world. The fund’s assets increased from $18 million to $14 billion during his 13-year tenure.
He retired from Fidelity in 1990 at age 46. Lynch still works part-time as vice chairman of Fidelity Management & Research Co., mentors young analysts, and focuses on his philanthropy.
The Fidelity Magellan Fund can still be invested in and its holdings still followed, and Lynch’s strategy of value investing can also be studied and followed by individual investors.
As a value investor, Lynch advised individual investors to “invest in what you know” to find good undervalued stocks. For example, Lynch has written that he invested in Dunkin’ Donuts after being impressed by their coffee as a customer, and not from reading about it in The Wall Street Journal. He thought others would be impressed and noted that the company’s Boston locations were always busy, and then he studied its financial status before investing. It turned out to be one of the best-performing stocks he ever bought.
The Magellan Fund invests in growth or value stocks and has a lifetime annual return of 15.94%. Its top five holdings are:
- Apple Inc.
- Microsoft Corp.
- Amazon
- Meta Platforms Inc. Class A
- NVIDIA Corp
7. Sallie Krawcheck
Sallie Krawcheck is the CEO and co-founder of Ellevest, a digital investment platform for women that was founded in 2014. Its goal is to close the gender investing gap.
Krawcheck, 57, is co-founder of Ellevest with Charlie Kroll. It's a robo-advisor that encourages users to invest in female-fronted companies. Ellevest is a low-cost way to invest, with no fees charged to invest and a monthly membership fee of $1, $5, or $9, depending on the tier users invest in.
Before launching Ellevest, Krawcheck worked for various Wall Street firms, was the chief financial officer for Citigroup, and was a research analyst covering the securities industry.
Ellevest’s forecasts for investors are a little different than what other digital advisors offer. Ellevest’s long-term returns of 3-5% for investors are slightly lower than what other investment advice companies project. Instead of just showing forecasts, Ellevest accounts for taxes, inflation, and fund fees, and builds layers of conservatism into its projections.
Its forecasts also show a higher likelihood of achievement, aiming for reaching an investor’s goals in 70% of markets, while other digital advisors shoot for 50%.
Costs
Investing in stocks, ETFs and other areas that the above investors buy can be done for free if you have a brokerage account that doesn’t charge trading fees. Just follow what they do and make the same trades, and you can mirror their moves without hiring a financial advisor.
If you want to invest directly in what these business titans are investing in, then you can buy their stocks. Warren Buffett’s Berkshire Hathaway and Carl Icahn’s Icahn Enterprises can be bought as shares on the stock market.
If you sell the stock and make a profit, then you’ll likely have to declare it as income and pay taxes on it. The same goes for dividends, though of the two only Icahn Enterprises pays a dividend — $2 quarterly for a 15.17 annual dividend yield. Berkshire Hathaway doesn’t pay a dividend.
Fans of The Motley Fool can pay for its Stock Advisor service and get stock recommendations each month. It costs $199 for one year or $39 for one month. But that’s only for the advice. Users will have to make the stock trades on their own.
If you want to follow the work that Peter Lynch started at the Fidelity Magellan Fund, you can still buy shares of the mutual fund through Fidelity. Fund holders are charged a management fee of 0.66%, and the net expense ratio of the fund is 0.78%. Assuming a $10,000 investment that grows by 5% per year, the total fees and expenses-sales charges would be $978 after 10 years.
The costs of Ellevest are different from most of the other investors we’ve listed to follow. Instead of a setlist of stocks for everyone to buy, it makes investment recommendations based on women’s generally lower incomes, different lifetime earnings curves, and longer lifespans. Portfolio recommendations are individualized.
Ellevest charges monthly account management fees of $1, $5, or $9. Its portfolios have expense ratios ranging from 0.06% to 0.26%.
Use Motley Fool's Stock Advisor To Invest
- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
- 2 New Stock Picks Every Month
- Investment Community With 700,000+ Loyal Members
- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
Pros and cons
Pros
- Many of the best investors often beat the S&P 500, so in theory, investors who follow their investments should be able to beat the market also.
- If nothing else, it can be fun to see what successful, big investors do in the financial markets and follow if they’re right.
- You can use the analytical tools that the best successful investors do, such as being a value investor and investing in low-cost mutual funds for the long term.
Cons
- Billionaire investors have a much easier time suffering losses during a major downturn than average investors do, so take that into account when deciding how much of your income to invest.
- Volatility is a part of investing, and the stock picks of one investor you like can undergo a lot of it quickly.
- No matter how much you mirror your favorite investor’s stock picks, you’re unlikely to become a billionaire or even a millionaire.
The bottom line
Following what wealthy investors do can at least keep you invested in the same stocks, real estate, and other investments they put their money in. Who knows? You may end up being the next Oracle of Omaha, or wherever you live.
Diversification and investing only what you can afford to lose can also make it easier when their stock picks go through downturns. At least by only following them in the news, your losses will only be imagined.
Joy Wallet is an independent publisher and comparison service, not an investment advisor, financial advisor, loan broker, insurance producer, or insurance broker. Its articles, interactive tools and other content are provided to you for free, as self-help tools and for informational purposes only. They are not intended to provide investment advice. Joy Wallet does not and cannot guarantee the accuracy or applicability of any information in regard to your individual circumstances. We encourage you to seek personalized advice from qualified professionals regarding specific investment issues. Featured estimates are based on past market performance, and past performance is not a guarantee of future performance.
Our site doesn’t feature every company or financial product available on the market. We are compensated by our partners, which may influence which products we review and write about (and where those products appear on our site), but it in no way affects our recommendations or advice. Our editorials are grounded on independent research. Our partners cannot pay us to guarantee favorable reviews of their products or services.
We value your privacy. We work with trusted partners to provide relevant advertising based on information about your use of Joy Wallet’s and third-party websites and applications. This includes, but is not limited to, sharing information about your web browsing activities with Meta (Facebook) and Google. All of the web browsing information that is shared is anonymized. To learn more, click on our Privacy Policy link.
Images appearing across JoyWallet are courtesy of shutterstock.com.
Writer
Aaron Crowe is a freelance journalist who specializes in personal finance writing and editing. He has worked at newspapers, where he won a Pulitzer Prize, and has written for numerous online publications. These include AOL, US News & World Report, WiseBread, Bankrate, AARP, and many websites focusing on housing, credit and insurance. He lives in California with his wife and daughter.
Share this article
