Below are some of the most interesting things I came across this week. Click here to subscribe to our free weekly newsletter and get this post delivered to your inbox each Saturday morning.
STAT
What does it mean to be the GOAT on Wall Street? Well, as The Journal reports, “Anyone lucky enough to invest $100 in Berkshire Hathaway shares in 1965 would have been sitting on a $5.5 million investment at the end of last year. The same sum invested in a yet-to-be-invented S&P 500 index fund would be worth around $39,000 today.”
CHART
One of the secrets of his success has been his ability patiently wait for opportunity to come knocking. “Buffett is celebrated for his stock picking, but he is also a crafty capital allocator. He has repeatedly shown a willingness to hold cash when opportunities are scarce, and to deploy it when he sees a fat pitch, usually in a down market,” reports Bloomberg.
STAT
Clearly, he sees the current environment as one of those times when patience is required. As The Financial Times reports, “Warren Buffett continued to sell stocks in the first three months of this year, the tenth consecutive quarter of net sales, and told Berkshire investors that he had not seen big opportunities to spend its mounting cash pile which rose to another record of $348bn.”
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It’s also worth noting that, in addition to generally avoiding being overexposed to stocks, he has also been avoiding long-term bonds, a topic which he touched on recently. “Buffett has described America’s finances as ‘a 7% gap when probably 3% is sustainable’ — which is a way of saying that you might want to buckle up,” reports MarketWatch.
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And the one area where he has actually been “greedy” lately is clearly the most “fearful” segment within the stock market, garnering only derision from investors and the financial media alike. It’s just the latest example of Buffett doing what he has done so well for so long now.
