Jeremy Grantham's GMO LLC increased its MSFT position by 17% to $2.3B (5.8% of portfolio), making it the top holding in the firm's Q1 2026 13F filing, while initiating a new $361M position in semiconductor EDA software firm SNPS. Total AUM stands at $23.8B across a highly concentrated 20-stock portfolio.
Top 5 Holdings — Q1 2026
- MSFT: $2.3B (5.8%)
- GOOGL: $2.0B (5.1%)
- JNJ: $1.8B (4.6%)
- AAPL: $1.8B (4.5%)
- META: $1.8B (4.5%)
Q1 2026 Key Portfolio Moves
The most notable shift in this filing is a deepening concentration in mega-cap tech. With MSFT (+17%), GOOGL (+3%), and JNJ (+3%) all seeing increased allocations, the top 5 holdings now account for approximately 24% of the total portfolio. AAPL, META, and AMZN also retain top-tier positions, confirming that GMO's preference for large-cap growth names carried through into this quarter.
- MSFT: Added +17% / $2.3B — Reinforces top holding status; signals stronger conviction in big tech
- SNPS: New position $361M — EDA software moat plays into AI chip design demand tailwind
- WFC: Reduced -99% / $6M — Near-complete exit from major bank exposure; reflects skepticism on financials
- PR: Reduced -99% / $4M — Significant energy sector retreat; portfolio repositioned toward defensive tilt
- CMA: Fully exited — Regional bank risk avoidance; offset by new WBS initiation for selective financials exposure
Meanwhile, financials and energy allocations were sharply reduced. WFC and PR were each cut by 99%, effectively eliminating those positions, while INTC was trimmed by 97%, leaving just $1M in residual exposure. CMA, EWJ, CYBR, and EXK were fully liquidated. New additions beyond SNPS include industrial software firm ROP ($40M), regional bank WBS ($33M), water utility WTRG ($30M), and semiconductor equipment maker ONTO ($28M).
GMO Portfolio Outlook & Key Takeaways
At first glance, Grantham's moves may seem at odds with his well-known reputation as a bubble prophet — but a closer look reveals a coherent logic. The increased big-tech concentration reads as a 'quality compression' trade into names with superior profitability and free cash flow. Initiating positions in semiconductor software and equipment names like SNPS and ONTO suggests a deliberate upstream bet on the AI infrastructure buildout cycle. The broad liquidation of bank, energy, and cybersecurity positions, however, signals that Grantham's wariness toward cyclical sectors and richly valued thematic plays remains intact. With just 20 holdings, the portfolio's extreme concentration underscores GMO's intent to deploy capital only where conviction is highest.
