If it were my sibling, this would also be true that only Apple would be bought of tech.Valuethinker wrote: ↑Fri May 13, 2022 8:13 amNor does he need to.nisiprius wrote: ↑Fri May 13, 2022 8:02 am If the 90% is QQQ then it isn't Warren Buffett's strategy.
I have to gripe about name-dropping a celebrity in support of a strategy that the celebrity does not support.
I challenge anybody to find anything, in the Berkshire Hathaway shareholder reports or elsewhere, where he even mentions QQQ. At all.
On the other hand, he frequently mentions, praises, and recommends "an S&P 500 index fund" and quite often will even add a reference to Vanguard, as in the 2013 annual report:If he'd meant "or QQQ" he could have said so. If he'd meant "90/10 is what's important, any decent stock fund will do for the 90" he could have said so. His references and praise specifically for S&P 500 index funds have been frequent and consistent.My money, I should add, is where my mouth is: What I advise here is essentially identical to certain instructions I’ve laid out in my will... My advice to the trustee could not be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard’s.)
I'm not one of those who is confident they know what "Warren" really means. I have not yet heard an explanation in his own words of whether the recommendation of an S&P 500 fund is intended to be a recommendation against total stock funds, factor tilts, or international stocks. I don't believe it is even clear that he is recommending the specific portfolio (90/10, 90% in an S&P 500 index fund and 10% in short-term government bonds) as a good all-purpose retirement savings portfolio.
But I feel very confident that Warren Buffett has never recommended QQQ.
At one point 40% (it was 20% and it might be less than that, now) of the value of Berkshire Hathaway could be accounted for by the value of its stake in Apple-- if you took the value of the stake in Apple over the BH market capitalisation.*
If one were "tracking" Buffett, one would hold Apple - alone amongst all the tech stocks. Despite being a close friend of Bill Gates, AFAIK Buffett has never held a significant stake in MSFT.
That position is presumably based on a level of contact with company management and analysis that no individual investor could hope to replicate. And even Buffett gets it expensively wrong - he said in retrospect he way overpaid for Precision Castparts (aerospace supplier).
* I am guessing Enterprise Value = net debt + market cap is meaningless for BH because of its large insurance operations.
But yes, using QQQ is a bad idea for the risks; I do not think there would be much of a premium even if it exists.