Berkshire Hathaway: A Good Alternative to Mutual Fund Investments

Last Updated: 17. Januar 2024By

For those who want to invest in more than one company, the stock of investment company Berkshire Hathaway is an option.

Berkshire Hathaway: Buffett’s investment company For those who are unfamiliar with the name Berkshire Hathaway: This is the company of American investment legend Warren Buffett. In 1965, Buffett acquired a small textile company and gradually formed it into an investment company with a focus on the insurance business. Through this holding, Buffett has been investing in other companies for over half a century with overwhelming success.

Some of these companies are 100% owned by Berkshire and are not (anymore) listed on the stock exchange. „See’s Candies“ (chocolate), „Brooks“ (sports shoes), „Fruit of the Loom“ (T-shirts) or „Duracell“ (batteries) are just a few examples of the many non-listed subsidiaries.

Apple is the largest position in the stock portfolio In addition, Berkshire holds numerous stakes in listed companies. The largest position in the stock portfolio by far has been Apple for quite some time. The iPhone company’s stock accounted for 50% of the portfolio at the end of September.

Behind it are Bank of America (9.0%), American Express (7.2%), Coca-Cola (7.1%), Chevron (5.9%), Occidental Petroleum (4.6%), Kraft Heinz (3.5%), and Moody’s (2.5%).

Fantastic development Warren Buffett’s track record is unique. Shareholders who invested only $1,000 at the beginning now have shares worth $12.8 million. On average, the book value of Warren Buffett’s investments has increased by almost 20% per year. And this over a period of more than half a century. A sensational achievement! The S&P 500, including dividends, only has a return of just under 10%.

The succession of the 93-year-old Buffett is regulated. The two investment managers Ted Weschler and Todd Combs are supposed to take over the management after Buffett’s death. Therefore, the chances are good that the positive development will continue in the future as well.

Source: www.aktienscreener.com

As you can see in the chart, Berkshire stock is an excellent long-term investment, in which – unlike funds – no advance flat tax has to be paid. Some banks even offer the option to invest in the stock through a savings plan.

However, it is not advisable to invest all your assets exclusively in this one stock. This is due to the extremely high weighting of the Apple stock, but also because of the high proportion of US companies. Since Berkshire invests in numerous companies, the stock can still play a significantly higher role in a stock portfolio.