Raymond James Financial Inc doubles down on broad beta and durable compounders

The biggest check written this quarter was to the S&P 500 itself. VOO saw an estimated +$772.6M add and IVV another +$119.0M, while QQQ and VUG also grew. The message is clear: after the drawdown, they see more upside in owning the market than in timing factor tilts.

Within tech, they refused to treat AI as “done.” Microsoft was lifted by +2.8% in shares even though it sits modestly below their average cost, and they kept nudging Nvidia, Broadcom, and Meta higher. They are underwriting the next leg of AI monetization, not just the last leg of multiple expansion.

Health care is the other clear conviction gainer. Eli Lilly got one of the largest single-stock boosts, with shares up +9.1% and an estimated +$124.7M added, complemented by incremental buys in AbbVie. They are paying up for durable, innovation-driven earnings rather than spreading across the sector.

Internationally, they are quietly expanding non‑US growth. IEFA and VEA both drew meaningful capital, with IEFA’s stake up +3.5% in shares and VEA up +9.9%. That tilt suggests they see more balanced return prospects across regions instead of a US-only AI bubble.

Funding for this re‑risking came from three buckets: redundant beta ETFs, mature compounders, and hedges. The heaviest trim was SPY, with shares cut -12.3% and roughly -$414.5M freed up, while XLK and IWF were also reduced. They are consolidating factor and sector bets into cheaper, more direct index and single-stock expressions.

They also skimmed some profits off long-standing winners. Walmart was reduced by -2.4% in shares despite a sizable gain over cost, and Alphabet’s GOOGL line was slightly trimmed even as GOOG was nudged up. That pattern looks like risk control around outsized winners rather than a change in fundamental view.

On the defensive side, they pulled back modestly from gold and income tilts. GLD was cut -2.5% and VYM and VTEB saw small reductions, indicating less appetite for crisis insurance and yield plays now that they are leaning harder into equities.

Energy rotation is more nuanced than a simple risk-on or risk-off. They cut Exxon by -6.1% in shares and shaved Marathon Petroleum, yet added +5.7% to Chevron. That looks like a relative-value re‑underwrite of integrated oils, not a wholesale call on crude.

At the sector level, this is not a wholesale rotation; it’s a clean-up. Technology’s weight is essentially unchanged, dipping only from 29.27% to 29.14%, but they migrated exposure toward core platforms like Microsoft and Meta while trimming tech ETFs like XLK. The bet is on idiosyncratic winners over blunt sector baskets.

Health care quietly gained strategic importance, rising from 4.44% to 4.47%, powered largely by Eli Lilly and AbbVie. That’s a small numeric move but a big signal: they are using high-conviction drug innovators as a defensive growth anchor instead of staples.

Energy ticked down from 3.27% to 3.20%, even with Chevron adds, reflecting trims to Exxon and Marathon. Finance and consumer discretionary both eased marginally, but mostly via position hygiene rather than thesis reversals. Unclassified exposure — overwhelmingly broad-market and style ETFs — crept up, showing that the real rotation is from complex factor overlays toward simple, scalable beta.

Telecom and industrials were nudged up via Verizon and Union Pacific, but remain small sleeves. Those moves read more like income and infrastructure ballast than active macro calls.

Taken together, the book now reads as a vote for staying invested in the bull market’s core drivers, with less reliance on hedges and clever wrappers. After a negative quarter, they chose to increase S&P 500 exposure, lean into AI platforms, and buy more of their highest-conviction pharma names. That is not the behavior of a manager trying to sidestep volatility; it’s a manager embracing it in size.

The subtle shifts away from gold, high-dividend ETFs, and some sector/factor products suggest they believe the easy money from defensive overlays has been made. In their place, broad beta and stock-specific growth dominate. If they’re wrong, the portfolio will feel full-cycle drawdowns more acutely than in prior, more hedged quarters.

The energy and mega-cap trims show discipline rather than capitulation. By recycling capital within sectors (Exxon to Chevron, GOOGL to GOOG) and around individual names, they’re fine-tuning exposures without abandoning themes. Going forward, expect Raymond James to keep using large, liquid ETFs as the chassis and a concentrated set of AI, pharma, and quality cyclicals as the alpha engine.

Investors watching their 13F should focus less on headline sector weights and more on where incremental dollars go. This quarter, those dollars say: own the market, own the rails of AI, and pay for real earnings power, not complexity.