Berkshire Hathaway - Warren Buffett - Anyone own the stock?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.

Do you own shares of Berkshire Hathaway?

Yes
80
39%
No
124
61%
 
Total votes : 204

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby TomatoTomahto » Sun May 05, 2013 2:53 pm

mmaguy wrote:Funny how so many bogleheads own Berkshire. Never seen it mentioned until this thread. I'd guess many people do not take the same advice they give.

I don't think that's fair. AFAIK, every BH that owns Berkshire (other than one, who also owns Apple in his "play funds") has pointed out that it is the only individual stock that they own. Berkshire has many attributes of a fund, and owns many businesses with a tilt towards some industries (insurance, railroads, food, etc.) -- it's a relatively diversified stock, and it is perfect in the tax sense. We also generally buy and hold.

It's not like we're day-trading Facebook shares :D
User avatar
TomatoTomahto
 
Posts: 2707
Joined: Mon Apr 11, 2011 2:48 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby jwillis77373 » Sun May 05, 2013 3:37 pm

Not at all.

Bogle says Fees matter, low cost investing is low cost investing.

In a taxable account a "dividend" can be considered an unnecessary "Fee" as long as there are low cost alternatives.

Boglehead investing is not about picking a Fund or an Index, or an investment company or vehicle. Its all about low costs, low Fees and avoiding an innate tendency to time the market. You could extend that to avoiding funds that drive up their costs by Actively trading the Stocks that they hold and passing the costs along to the investors.

Saying "this time its different" can be carried to both extremes. As long as you invest based on your research and "stay the course" to a plan.

The principals are the same.
User avatar
jwillis77373
 
Posts: 125
Joined: Mon Jun 25, 2007 10:52 pm
Location: Texas

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby SGM » Sun May 05, 2013 5:26 pm

Berkshire Hathaway became too large a part of our portfolio and we now only hold it within index funds. I would not be averse to owning it again if it looked like a screaming opportunity.
"Let us endeavor, so to live, that when we die, even the undertaker will be sorry." Mark Twain
SGM
 
Posts: 1010
Joined: Wed Mar 23, 2011 5:46 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby 123 » Sun May 05, 2013 7:08 pm

I have a couple hundred Berkshire Hathaway "B" shares. It's far less then 5% of our portfolio. The rest of our portfolio is in index funds/etfs, mostly Vanguard. The Berkshire shares are the "spice" in the portfolio. We like things pretty plain. We got them to give us an opportunity to attend the annual meeting if we ever get around to it. It impresses my wife that we've got Berkshire shares. I don't expect to make a killing on them and don't particularly think they'll take a dive much faster or greater then the market as a whole. Primarily they serve an entertainment function, just something relatively safe to follow individually where we have skin in the game. One day perhaps I'll tell my teenage son when Warren is on TV that Warren is working for us. That right moment just hasn't happend yet.
The closest helping hand is at the end of your own arm.
123
 
Posts: 380
Joined: Fri Oct 12, 2012 4:55 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby bogle2013 » Sun May 05, 2013 8:25 pm

at the end of the day, if the average investor had put every available $ to buy into BRK.b over the last few decades, and that is all they did, they would have done very well. as opposed to trying to decide btw intermediate or short term bonds, small value tilt or not, precious metals or emerging markets, etc... there are a lot worse investments than BRK. nothing to be ashamed of.
bogle2013
 
Posts: 47
Joined: Tue Jan 22, 2013 4:56 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby racy » Sun May 05, 2013 8:43 pm

I bought 1 class A share in December 1987 for about $3700.
racy
 
Posts: 108
Joined: Sun Mar 30, 2008 8:38 am
Location: Earth

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby zaboomafoozarg » Sun May 05, 2013 9:19 pm

I had never realized before that BRK.B makes up .5% of VTSMX. For some reason I didn't think it counted... not sure why, LOL.
User avatar
zaboomafoozarg
 
Posts: 1050
Joined: Sun Jun 12, 2011 1:34 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby assumer » Sun May 05, 2013 9:28 pm

zaboomafoozarg wrote:I had never realized before that BRK.B makes up .5% of VTSMX. For some reason I didn't think it counted... not sure why, LOL.


So that means that the companies the Berkshire owns are "double" counted in VTSMX for example? As in, shares of Coca Cola are owned by VTSMX outright, and even more shares are owned indirectly by Berkshire, which also is in VTSMX?
assumer
 
Posts: 415
Joined: Sat Dec 22, 2012 12:11 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby zaboomafoozarg » Sun May 05, 2013 10:12 pm

assumer wrote:
zaboomafoozarg wrote:I had never realized before that BRK.B makes up .5% of VTSMX. For some reason I didn't think it counted... not sure why, LOL.


So that means that the companies the Berkshire owns are "double" counted in VTSMX for example? As in, shares of Coca Cola are owned by VTSMX outright, and even more shares are owned indirectly by Berkshire, which also is in VTSMX?


Ah yeah, that's why I didn't think it would in there - because I thought of it as a mutual fund. Looks like it's a holding company though, which isn't the same thing.
User avatar
zaboomafoozarg
 
Posts: 1050
Joined: Sun Jun 12, 2011 1:34 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby talzara » Mon May 06, 2013 1:37 am

assumer wrote:So that means that the companies the Berkshire owns are "double" counted in VTSMX for example? As in, shares of Coca Cola are owned by VTSMX outright, and even more shares are owned indirectly by Berkshire, which also is in VTSMX?


The CRSP US Total Market Index is a float-adjusted index. Closely-held shares, such as those held by Berkshire Hathaway or shares held by insiders, are not included in the free float.

Thus, in the example you gave, the shares would not be included in the weighting of Coca-Cola. They would only be indirectly included as part of Berkshire Hathaway's market cap. For example, should Berkshire Hathaway ever be priced below liquidation value, then Coca-Cola would in some sense not be fully counted in the index.

However, this is consistent with the intention of the float-adjusted index, which seeks to capture the investable universe. It is Berkshire Hathaway that investors have the ability to purchase -- not the Coca-Cola shares that it owns. The shares held by Berkshire Hathaway are considered to be unavailable to the public -- to at least the same extent as shares held by insiders.
talzara
 
Posts: 94
Joined: Thu Feb 12, 2009 8:40 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Valuethinker » Mon May 06, 2013 2:51 am

zaboomafoozarg wrote:
assumer wrote:
zaboomafoozarg wrote:I had never realized before that BRK.B makes up .5% of VTSMX. For some reason I didn't think it counted... not sure why, LOL.


So that means that the companies the Berkshire owns are "double" counted in VTSMX for example? As in, shares of Coca Cola are owned by VTSMX outright, and even more shares are owned indirectly by Berkshire, which also is in VTSMX?


Ah yeah, that's why I didn't think it would in there - because I thought of it as a mutual fund. Looks like it's a holding company though, which isn't the same thing.


Technically it looks most like a 'Closed End Fund'.

But it's not an investment company within the meaning of the US 1940 Investment Companies Act, I don't believe.

Rather it's a holding company. Like GE for example-- also a highly diversified conglomerate.
Valuethinker
 
Posts: 24689
Joined: Fri May 11, 2007 12:07 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby dhodson » Mon May 06, 2013 9:37 am

mmaguy wrote:Funny how so many bogleheads own Berkshire. Never seen it mentioned until this thread. I'd guess many people do not take the same advice they give.



i cant speak for everyone else but as i mentioned above for me i own a few shares as gambling or entertainment purposes. I could buy penny stocks but i prefer playing games with better odds like craps. Im not foolish enough to believe though that by playing craps instead of a lower odds game that the odds are now in my favor or that playing the game makes sense from a math/scientific point of view. I also wasnt born a boglehead so i have a past that im managing. I also imagine that bogleheads are a diverse group. For instance im Catholic (at least i call myself Catholic) but i firmly believe in birth control and there are other issues where the Pope and I dont seem to see eye to eye. Maybe im not Catholic or a boglehead by a strict definition? I imagine that applies to a lot of people.
dhodson
 
Posts: 3220
Joined: Mon May 24, 2010 4:03 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby danwhite77 » Mon May 06, 2013 9:47 am

mmaguy wrote:Funny how so many bogleheads own Berkshire. Never seen it mentioned until this thread. I'd guess many people do not take the same advice they give.


Actually, I've read all of Warren's letters to shareholders and many of Jack Bogle's writings and I've always marveled at how they say much of the same thing but embrace two entirely different philosophies.
"While some mutual fund founders chose to make billions, he chose to make a difference." - Dedication to Jack Bogle in 'The Bogleheads' Guide to Investing'.
User avatar
danwhite77
 
Posts: 285
Joined: Thu Mar 08, 2012 10:21 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Call_Me_Op » Mon May 06, 2013 9:50 am

Owning Berkshire is no different fundamentally from owning any other single stock. That's why I don't bother.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein
Call_Me_Op
 
Posts: 4629
Joined: Mon Sep 07, 2009 3:57 pm
Location: Milky Way

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby inbox788 » Mon May 06, 2013 11:53 am

Call_Me_Op wrote:Owning Berkshire is no different fundamentally from owning any other single stock. That's why I don't bother.

Beg to differ, but it's like saying owning VOO (vanguard s&p 500 etf) is no different fundamentally from owning any other single stock. Berkshire is a hybrid, both individual companies as well as a fund. Some large companies like GE or Microsoft can also be considered hybrids to some degree, particularly for their large investment and finance operations. What separates these other single stocks from Berkshire is that their adjunc operations are usually more closely tied to their core business, whereas with Berkshire isn't.
inbox788
 
Posts: 884
Joined: Thu Mar 15, 2012 6:24 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Call_Me_Op » Mon May 06, 2013 5:57 pm

I'd much rather own the S&P 500 - although even that shouldn't comprise too much of your portfolio.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein
Call_Me_Op
 
Posts: 4629
Joined: Mon Sep 07, 2009 3:57 pm
Location: Milky Way

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby tr123 » Mon May 06, 2013 8:59 pm

I'm a Boglehead who believes in the simple portfolio approach (TSM, TISM, and TBM), yet I do own some individual stocks. I am a railroad buff. Less than one per cent of my portfolio is in what I call my railroad index. 10 shares each of CNI, CP, NSC, CSX, KSU, PRRR, GWR, PWX, UNP, and BRK.B. The BRK.B was acquired when Berkshire took over Burlington Northern Santa Fe. They offered stock, or cash, or a combo. I chose stock. I've kept BRK.B in my portfolio because they do own BNSF, and, to my pleasant surprise, found I can get a discount on my car insurance. So, I'm still an advocate of the lazy portfolio approach, but I have no problem holding some individual stocks for fun as it is such a small part of my portfolio.
tr123
 
Posts: 25
Joined: Mon Mar 26, 2012 11:59 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby TomatoTomahto » Tue May 07, 2013 12:03 pm

Article in today's NYT (by Andrew Ross Sorkin) about the Berkshire stockholder's meeting: http://dealbook.nytimes.com/2013/05/06/for-buffett-the-past-isnt-always-prologue/

One interesting part of this was about Berkshire Hathaway as an index fund and the size issue. Note that Mr. Kass is negative on Berkshire, is short Berkshire, and was invited to the stockholder's meeting by Berkshire specifically to ask tough questions of Buffett and Munger:
Mr. Buffett put it bluntly: “There’s no question that we cannot do as well as in the past, and size does matter.” In last year’s annual report, Mr. Buffett described his expectations for Berkshire by saying that the company’s “intrinsic value will over time likely surpass the S.& P. returns by a small margin,” and even suggested that “when the market is particularly strong, expect us to fall short.”

Mr. Kass was much less delicate. “Is Berkshire resembling an index fund more appropriate for widows and orphans?” he pondered.
User avatar
TomatoTomahto
 
Posts: 2707
Joined: Mon Apr 11, 2011 2:48 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby PGR » Tue May 07, 2013 2:21 pm

Calm Man wrote:
Calm Man wrote:I wouldn't invest a penny with that clown.


There's a difference between trolling and speaking the truth - if you don't like the truth, then keep it to yourself. Calling me a troll after 6000+ posts is a bit ridiculous, don't you think?


So let me get this straight. Labeling WB as "that clown" is not an opinion but rather 'the truth'? And having a post count of over 6k grants immunity from trolling. Interesting. But here's where I get confused - if it really is true as you say that WB is a clown, it's not trolling and you really don't need to invoke the 6k post count defense at all right? At any rate, perhaps the former should go on WB's wiki page and the later should be amended to our Policies and Etiquette statement. :happy
PGR
 
Posts: 169
Joined: Thu Apr 10, 2008 7:25 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby HardKnocker » Tue May 07, 2013 2:48 pm

Instead of buying BH I bought Beanie Babies. Time will tell... :|
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
User avatar
HardKnocker
 
Posts: 1987
Joined: Mon Oct 06, 2008 12:55 pm
Location: New Jersey USA

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Valuethinker » Tue May 07, 2013 5:15 pm

danwhite77 wrote:
mmaguy wrote:Funny how so many bogleheads own Berkshire. Never seen it mentioned until this thread. I'd guess many people do not take the same advice they give.


Actually, I've read all of Warren's letters to shareholders and many of Jack Bogle's writings and I've always marveled at how they say much of the same thing but embrace two entirely different philosophies.


Does the company publish them back to the 1960s? Or do you have another source?

The old ones would make really interesting reading.
Valuethinker
 
Posts: 24689
Joined: Fri May 11, 2007 12:07 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby abuss368 » Tue May 07, 2013 9:44 pm

The Berkshire Hathaway website notes 1977 as the first year. There is a book available for sale on Amazon (with a link on Berkshire's website) that has all of the Shareholder letters unedited.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + REITs
User avatar
abuss368
 
Posts: 6287
Joined: Mon Aug 03, 2009 3:33 pm
Location: At the Beach

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby IlikeJackB » Tue May 07, 2013 10:40 pm

Valuethinker wrote:
Does the company publish them back to the 1960s? Or do you have another source?

The old ones would make really interesting reading.


This link has the letters to his partners in the pre-Berkshire Hathaway days: http://www.rbcpa.com/WEB_letters/WEB_Le ... EDOFF.html
Keith
User avatar
IlikeJackB
 
Posts: 110
Joined: Fri Dec 31, 2010 10:59 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby abuss368 » Wed May 08, 2013 10:00 am

IlikeJackB wrote:
This link has the letters to his partners in the pre-Berkshire Hathaway days: http://www.rbcpa.com/WEB_letters/WEB_Le ... EDOFF.html



Awesome! Thank you so much!!!
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + REITs
User avatar
abuss368
 
Posts: 6287
Joined: Mon Aug 03, 2009 3:33 pm
Location: At the Beach

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby james22 » Wed May 08, 2013 12:00 pm

As a provider of liquidity, BRK is unique.

10% of my portfolio.
Risk ≠ Reward
james22
 
Posts: 968
Joined: Tue Aug 21, 2007 3:22 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby baw703916 » Wed May 08, 2013 8:44 pm

james22 wrote:As a provider of liquidity, BRK is unique.


Yes, making a payday loan to Goldman Sachs was priceless.
Most of my posts assume no behavioral errors.
User avatar
baw703916
 
Posts: 5585
Joined: Sun Apr 01, 2007 2:10 pm
Location: Northern Virginia

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby inbox788 » Thu May 09, 2013 7:50 pm

mmaguy wrote:Funny how so many bogleheads own Berkshire. Never seen it mentioned until this thread. I'd guess many people do not take the same advice they give.


Does seem a little ironic. There is some argument that Berkshire is an active investment making stock picks, which is contrary to setting an asset allocation and letting it ride. On the other hand, using index funds in an asset allocation aren't entirely passive. There's an element of choosing when selecting most index funds. One way to think about the Dow or S&P500 is a slow turnover active management fund with selecting large companies representative parts of the economy. Using this thought, Berkshire Hathaway is pretty much the same thing. Instead of adding a stock overnight like the S&P 500, Berkshire adds to the stock over some time, and same thing when getting out. Same thing with getting into and exiting some businesses (consumer, insurance, finance). Stated criteria for including or excluding stocks into the group are slightly different, and that may be the crux of the difference. But if you go back to asset allocation accounting for the majority of the fund performance, and take a close look at what is in the allocations, there's a lot more similarity than difference.
inbox788
 
Posts: 884
Joined: Thu Mar 15, 2012 6:24 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby baw703916 » Thu May 09, 2013 10:39 pm

Of course if you decide to just stick to index funds and not own any individual stocks, not even BRK, WB won't take issue with that approach. Remember he bet in 2008 that Vanguard S&P 500 Index Admiral Shares would beat a fund of hedge funds over a 10 year period. He's now ahead, even though it lost 37% in the first year.

http://finance.fortune.cnn.com/2013/01/ ... -fund-bet/
Most of my posts assume no behavioral errors.
User avatar
baw703916
 
Posts: 5585
Joined: Sun Apr 01, 2007 2:10 pm
Location: Northern Virginia

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby abuss368 » Fri May 31, 2013 11:36 pm

Thank you everyone for your kind responses to date. I have enjoyed this post.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + REITs
User avatar
abuss368
 
Posts: 6287
Joined: Mon Aug 03, 2009 3:33 pm
Location: At the Beach

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby thebogledude » Sat Jun 01, 2013 2:08 am

I first came across BRK-A in late 80s when it was 3,000/share and I said who would pay $3000 for a share? Oops.
I seem to recall that Buffet acquired the huge stake in KO when they came out with New Coke to make it taste more like Pepsi
and Coke's price tanked.
I'm not sure how to interpret the big stake in IBM. They seem to load up on IBM in last year or two and goes against Buffet's style IMHO.
thebogledude
 
Posts: 409
Joined: Thu Jun 09, 2011 1:40 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Valuethinker » Sat Jun 01, 2013 2:53 am

thebogledude wrote:I first came across BRK-A in late 80s when it was 3,000/share and I said who would pay $3000 for a share? Oops.
I seem to recall that Buffet acquired the huge stake in KO when they came out with New Coke to make it taste more like Pepsi
and Coke's price tanked.
I'm not sure how to interpret the big stake in IBM. They seem to load up on IBM in last year or two and goes against Buffet's style IMHO.


Buffett's quoted stakes are almost no longer relevant-- certainly not the newly acquired ones. He can't buy enough stock to make a significant difference to his performance.

He's taking a read that IBM is too cheap relative to its franchise value. It is perhaps the only tech company that has survived more than 2 cycles. Go back to the 60s and 70s, all of the tech stocks are pretty much dead and buried-- Polaroid, Kodak, DEC etc. Look at Dell now v. Dell in 1999. Sun Microsystems? (actually Oracle is the other survivor stock I would guess).
Valuethinker
 
Posts: 24689
Joined: Fri May 11, 2007 12:07 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby lhl12 » Sat Jun 01, 2013 9:55 am

Those who are interested in understanding Berkshire Hathaway in greater detail might consider looking at this presentation:

http://www.tilsonfunds.com/BRK.pdf

This was researched and written by a money manager named Whitney Tilson, who (actively) manages a fund whose largest position is Berkshire Hathaway. He has posted his analysis publicly for anyone who is interested.

I offer no opinion on the merits of his analysis, but it does seem comprehensive and reasonably well researched, and seems to be a good primer on Berkshire Hathaway.
lhl12
 
Posts: 234
Joined: Mon May 27, 2013 9:24 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby investor » Sat Jun 01, 2013 12:50 pm

have had BRK.b since 1996.... works well in taxable account

investor
investor
 
Posts: 733
Joined: Mon Feb 19, 2007 11:50 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Buffetologist » Sat Jun 01, 2013 1:19 pm

I've owned B-shares since 1997. It's my largest individual stock holding. Never touched it. Don't have any plans to.
Buffetologist
 
Posts: 149
Joined: Sun Aug 22, 2010 9:58 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Grt2bOutdoors » Sat Jun 01, 2013 1:24 pm

Don't own it, but am thinking about taking my cash-take out Uncle Warren/Abel has decided to give me and buy back into it.
"Luck is not a strategy" Asking Portfolio Questions
Grt2bOutdoors
 
Posts: 9987
Joined: Thu Apr 05, 2007 9:20 pm
Location: New York

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby sherwink » Sat Jun 01, 2013 3:19 pm

I've owned B shares for a few years, with no intention of selling anytime soon.
sherwink
 
Posts: 191
Joined: Mon May 28, 2007 10:48 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby investor » Sat Jun 01, 2013 4:17 pm

sorry duplicate post
investor
 
Posts: 733
Joined: Mon Feb 19, 2007 11:50 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Redstorm » Thu Aug 14, 2014 9:47 pm

From the news

CLASS A shares of Berkshire jumped past the milestone to an all-time trading high of $US201,740 ($A218,274.28) Thursday morning.

It has taken 44 years (1962-2006) to reach first $100K and 8 years for the second. Would be interesting to see how many years it takes to reach the third.
User avatar
Redstorm
 
Posts: 108
Joined: Thu May 02, 2013 3:43 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby ofcmetz » Thu Aug 14, 2014 11:10 pm

mmaguy wrote:Funny how so many bogleheads own Berkshire. Never seen it mentioned until this thread. I'd guess many people do not take the same advice they give.


While all my equity is in index funds, I don't think it hurts to have a small part of one's investment in something like BRK. It's not for me, but I don't begrudge those that do. I realize that I would be no better than average at picking winners which is why I index. I find BRK's story fascinating and also realize it's one of those once in a lifetime investing stories. I think it's cool that a lot of bogleheads have taken part in it's epic gain.
Showing up at the donut shop at 5 am to get them hot out of the oil is an example of successful market timing.
User avatar
ofcmetz
 
Posts: 1737
Joined: Tue Feb 08, 2011 9:09 pm
Location: Louisiana

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby chameleon » Fri Aug 15, 2014 12:08 am

I look at Warren Buffet as a king and Berkshire Hathaway as his kingdom. When the visionary King is gone the kingdom rarely sustains its luster. The man is a genius and the type of person who isn't easily replaceable.
chameleon
 
Posts: 61
Joined: Wed Aug 21, 2013 12:17 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby celia » Fri Aug 15, 2014 3:12 am

I bought some since I look at it as if it is a mutual fund. It is more diversified than some funds.

YOU may also own some class B shares and not even be aware of it. The investment company that owns the most shares is Vanguard. It owns 6.3% of the class B shares, ahead of the the Bill and Melinda Gates Foundation.

chameleon wrote:I look at Warren Buffet as a king and Berkshire Hathaway as his kingdom. When the visionary King is gone the kingdom rarely sustains its luster. The man is a genius and the type of person who isn't easily replaceable.

I believe he has already planned for that. He is not going to ignore something that could damage the company.
User avatar
celia
 
Posts: 1814
Joined: Sun Mar 09, 2008 7:32 am
Location: SoCal

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Boglegrappler » Fri Aug 15, 2014 8:22 am

Well, he'll have the same problem controlling things from beyond the grave as we all will. But he has had a pretty good track record of picking the right businesses and people to invest in, and he has a couple of potential successors who seem to share some of his personality traits.

I had a discussion with someone about the question of how much of Buffett's success (outperformance) was due to qualitative excellence in stock selection, and how much was due to the calm, patient, "don't fire til you see the whites of their eyes" opportunistic investment timing. There is an important component of both, but I realized in thinking it through that it could easily be tested by just plugging his traded stock positions into google finance and comparing the long term graph to the S&P. If you do that for Walmart, Coke, Amex, and Wells Fargo, it becomes clear that he had some awfully good insight on what stocks to buy.
Last edited by Boglegrappler on Fri Aug 15, 2014 8:23 am, edited 1 time in total.
Boglegrappler
 
Posts: 180
Joined: Wed Aug 01, 2012 10:24 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Beliavsky » Fri Aug 15, 2014 8:22 am

ogd wrote:I am tempted to buy some Berkshire, actually, because it seems to be much like a value-tilted actively managed fund, with at-cost expenses (you get all the profits), which does not pay any dividends or distribute any capital gains.

When the stocks owned by Berkshire pay dividends, doesn't Berkshire have to pay taxes on 30% of them (there is a 70% exclusion for dividends received by corporations)? When Berkshire eventually pays dividends from the dividends it has received, they will have been taxed 1.3 times, sort of. I thought conglomerates were supposed to be tax-inefficient for this reason. An advantage of mutual funds is that they are not taxed at the fund level.

Warren Buffet has been savvy about reducing taxes. So maybe this argument about the tax inefficiency of Berkshire is missing something.
Beliavsky
 
Posts: 150
Joined: Sun Jun 29, 2014 11:21 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby plantingourpennies » Fri Aug 15, 2014 9:30 am

I own a share of BRK.B-we used it to attend the shareholder's event this year and will do the same next year (if any other bogleheads will be on site send me a note!)

At what other time can i see a genius speak openly and take question from a crowd/panel for 6 or so hours on a set of topics that deeply interest me?

Best,
Mr. PoP
plantingourpennies
 
Posts: 18
Joined: Sun Jun 24, 2012 7:28 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby ogd » Fri Aug 15, 2014 1:17 pm

Beliavsky wrote:
ogd wrote:I am tempted to buy some Berkshire, actually, because it seems to be much like a value-tilted actively managed fund, with at-cost expenses (you get all the profits), which does not pay any dividends or distribute any capital gains.

When the stocks owned by Berkshire pay dividends, doesn't Berkshire have to pay taxes on 30% of them (there is a 70% exclusion for dividends received by corporations)? When Berkshire eventually pays dividends from the dividends it has received, they will have been taxed 1.3 times, sort of. I thought conglomerates were supposed to be tax-inefficient for this reason. An advantage of mutual funds is that they are not taxed at the fund level.

Warren Buffet has been savvy about reducing taxes. So maybe this argument about the tax inefficiency of Berkshire is missing something.

This is a good point. I am not 100% sure about how this works, but 35% of 30% is 10.5%, which is much less than the 30%+ I'd be paying in California. The rest I'd take as capital gains, hopefully as late as possible. Hypotetically speaking, because I did vote "no".

Perhaps the argument about conglomerates is about holding them in tax-advantaged accounts, where indeed a MF or REIT structure works much better.
User avatar
ogd
 
Posts: 2180
Joined: Fri Jun 15, 2012 12:43 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby Gilberto » Fri Aug 15, 2014 4:58 pm

I own a few shares of BRK.B, so that I get the shareholders reports and can attend the annual meeting. It's the only individual stock I own, and more for the entertainment value than as an investment.
Practicing nonattachment...
User avatar
Gilberto
 
Posts: 4
Joined: Sun Jun 29, 2014 12:27 pm
Location: Berkeley, CA

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby investor » Fri Aug 15, 2014 5:43 pm

Have had BRK.b since 1996 in my taxable account. Great for tax deferred investing. No dividends to be taxed and capital gains only if/when you sell.

investor
investor
 
Posts: 733
Joined: Mon Feb 19, 2007 11:50 pm

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby spectec » Fri Aug 15, 2014 5:46 pm

It's like a non-deductible IRA without the paperwork and contribution limits, isn't it?
Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it. - Will Rogers
spectec
 
Posts: 153
Joined: Mon Jul 14, 2014 9:00 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby JoMoney » Fri Aug 15, 2014 6:01 pm

If it is like a mutual fund, it's one with a 40% front-end load (book value is around 1.4x currently). If it works out well, you'll get that back when you sell it in addition to whatever the multiple is times whatever book value growth has been achieved. If things work out well. There are some risks about what impacts will result when the current management changes, and some other pretty unique risks as well. Buffett has said, "when a major quake occurs in an urban area or a winter storm rages across Europe, light a candle for us. "
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
User avatar
JoMoney
 
Posts: 1376
Joined: Tue Jul 23, 2013 6:31 am

Re: Berkshire Hathaway - Warren Buffett - Anyone own the sto

Postby celia » Fri Aug 15, 2014 6:26 pm

spectec wrote:It's like a non-deductible IRA without the paperwork and contribution limits, isn't it?

No.

You can have a taxable account or an IRA or a 401K or a 529 account. The value of that account changes depending on what you invest in inside the account, not because of the type (titling) of the account. In other words, you can own BRK in any of these accounts and the value will go up or down the same.

I think the paperwork you refer to is how it is reported on your taxes. In my examples, the taxable account is the only one where gains or loses need to be reported on a tax return for the year of sale. For the others, withdrawals from the account are reported for the year of withdrawal and taxed (or not) according to the rules for that type of account.
User avatar
celia
 
Posts: 1814
Joined: Sun Mar 09, 2008 7:32 am
Location: SoCal

PreviousNext

Return to Investing - Theory, News & General

Who is online

Users browsing this forum: bertilak, Bing [Bot], chaz, gwrvmd, JonnyDVM, Miakis, nfs, novicemoney, Rodc, RunningRad, tyler_cracker, wearymicrobe, yosef and 64 guests