Fundsmith LLP Portfolio in 2026: Top Holdings & Recent Changes
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Terry Smith, the renowned fund manager behind Fundsmith LLP, showcases his disciplined "buy good companies and don't overpay" philosophy in the latest 13F filing. His $19.8B Q3 2025 portfolio reflects strategic pruning across mega positions while adding to select high-quality names, maintaining extreme concentration amid market volatility.
Portfolio Overview: Quality Concentration in Action
Portfolio Highlights (Q3’2025): - Market Value: $19.8B - Top 10 Holdings: 67.7% - Portfolio Size: 35 -4 - Average Holding Period: 20 quarters - Turnover: 11.4%
Fundsmith's portfolio exemplifies Terry Smith's long-term focus on high-quality, cash-generative businesses, with the top 10 holdings commanding a staggering 67.7% of the $19.8B total. The reduction in portfolio size to 35 positions signals deliberate streamlining, eliminating four underperformers while keeping turnover modest at 11.4%. This approach underscores a patient strategy, where the average holding spans 20 quarters—over five years—prioritizing enduring competitive advantages over short-term trades.
The concentration remains a hallmark, with healthcare and technology leaders dominating. Smith's willingness to trim even top performers like Microsoft and Meta suggests profit-taking after strong runs, reallocating to names like Waters Corporation. Access the full details on Fundsmith's live portfolio tracker at ValueSense to monitor these shifts in real-time.
This disciplined evolution maintains Fundsmith's edge in volatile markets, balancing growth exposure with resilient moats across sectors.
Top Holdings: Strategic Pruning in Healthcare and Tech Giants
Fundsmith's Q3 2025 lineup leads with Stryker Corporation (SYK) at 8.6%, trimmed by 1.83% as the medical device leader maintains its top spot with $1,697.3M in value. Close behind is IDEXX Laboratories (IDXX) (8.4%, Reduce 1.09%), another healthcare stalwart focused on animal health diagnostics holding steady at $1,667.8M. Alphabet (GOOGL) follows at 7.7% ($1,528.9M, Reduce 7.56%), reflecting caution on big tech valuations.
Dramatic moves define the core: Microsoft (MSFT) slashed 47.72% to 6.8% $1,338.1M, while Visa (V) saw a minor Add 0.01% to 6.6% $1,315.8M, signaling enduring payment network conviction. Automatic Data Processing (ADP) dipped 1.16% to 6.4% $1,265.5M, but Waters Corporation (WAT) boosted 9.62% to 6.0% $1,185.9M, highlighting lab equipment as a fresh emphasis.
Further adjustments include Philip Morris International (PM) reduced 20.78% to 5.9% $1,165.9M, Meta Platforms (META) cut 56.32% to 5.8% $1,144.7M—the quarter's boldest trim—and Marriott International (MAR) lightly reduced 0.20% to 5.6% $1,101.2M. These changes across the top 10 reveal profit-taking in overextended tech while reinforcing healthcare and select consumer staples.
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What the Portfolio Reveals
Fundsmith's Q3 moves paint a clear picture of Terry Smith's quality-first strategy amid lofty valuations:
- Quality Over Speculative Growth: Heavy trims in MSFT -47.72% and META -56.32% suggest taking profits on high-flyers, pivoting to resilient names like SYK and WAT.
- Healthcare Dominance: Top spots held by Stryker and IDEXX emphasize defensive growth in medtech and diagnostics, less sensitive to economic cycles.
- Tech Discipline: Retaining Alphabet and Visa shows conviction in moaty leaders, but cuts signal valuation awareness.
- Global Focus with U.S. Tilt: Primarily U.S.-centric holdings provide stability, with Philip Morris adding international dividend reliability.
- Risk Management via Turnover: 11.4% turnover and portfolio trim to 35 positions indicate active but measured portfolio hygiene.
Portfolio Concentration Analysis
| Position | Value | % of Portfolio | Recent Change |
|---|---|---|---|
| Stryker Corporation | $1,697.3M | 8.6% | Reduce 1.83% |
| IDEXX Laboratories, Inc. | $1,667.8M | 8.4% | Reduce 1.09% |
| Alphabet Inc. | $1,528.9M | 7.7% | Reduce 7.56% |
| Microsoft Corporation | $1,338.1M | 6.8% | Reduce 47.72% |
| Visa Inc. | $1,315.8M | 6.6% | Add 0.01% |
| Automatic Data Processing, Inc. | $1,265.5M | 6.4% | Reduce 1.16% |
| Waters Corporation | $1,185.9M | 6.0% | Add 9.62% |
| Philip Morris International Inc. | $1,165.9M | 5.9% | Reduce 20.78% |
| Meta Platforms, Inc. | $1,144.7M | 5.8% | Reduce 56.32% |
| Marriott International, Inc. | $1,101.2M | 5.6% | Reduce 0.20% |
This table underscores Fundsmith's ultra-concentrated bet on quality, with the top 10 devouring 67.7% of the portfolio—a level rivaling the most focused superinvestors. The aggressive reductions in Microsoft and Meta freed up capital for additions like Waters, demonstrating dynamic position sizing without abandoning core convictions. Healthcare's 23% slice (Stryker + IDEXX) provides ballast, while tech trims mitigate bubble risks.
Overall, the shifts reveal a portfolio engineered for compounding through superior businesses, not chasing momentum.
Investment Lessons from Terry Smith's Fundsmith Approach
- Buy Quality and Hold Long: 20-quarter average tenure proves patience with great companies like Visa trumps frequent trading.
- Trim Winners Ruthlessly: Massive cuts in MSFT -47.72% and META -56.32% show profit-taking preserves gains.
- Concentrate on Moats: 67.7% in top 10 demands deep understanding—healthcare leaders like Stryker exemplify durable advantages.
- Active Pruning Keeps Discipline: Dropping to 35 positions -4 eliminates mediocrity, maintaining focus.
- Valuation Discipline Persists: Additions like Waters +9.62% target relative value in quality names.
Looking Ahead: What Comes Next?
Fundsmith's Q3 positioning sets up for resilience in uncertain markets, with trimmed tech exposure reducing downside risk and healthcare heft providing steady growth. The 11.4% turnover and four position cuts suggest cash deployment opportunities in undervalued quality—potentially more medtech or consumer staples if valuations correct. Low portfolio size implies selectivity for new bets, favoring businesses with strong free cash flow amid high rates.
Watch for further rotations if tech cools, with Fundsmith's tracker ideal for spotting Q4 shifts. Current setup favors compounding over speculation.
FAQ about Fundsmith LLP Portfolio
Q: What drove the massive reductions in Microsoft and Meta?
A: Terry Smith trimmed Microsoft by 47.72% and Meta by 56.32%, likely locking in profits after exceptional runs while managing concentration risk in soaring tech valuations.
Q: Why is Fundsmith's portfolio so concentrated?
A: With 67.7% in the top 10 across just 35 holdings, Smith's strategy bets big on high-conviction quality names like Stryker, prioritizing deep research over diversification for superior long-term returns.
Q: What sectors dominate Fundsmith's Q3 2025 holdings?
A: Healthcare leads with Stryker and IDEXX, complemented by tech (Alphabet) and payments (Visa), balancing growth and stability.
Q: How can I track Fundsmith's portfolio like a pro?
A: Use ValueSense's Fundsmith tracker for real-time 13F updates—note the 45-day filing lag means Q3 data reflects September 2025 positions. Pair with intrinsic value tools for your own analysis.
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