Talk me out of Berkshire ! if you can

arrowloopboy

A friend has asked me for some investment advice(long term) ,he won't need the money for the foreseeable future,he's around 40 ,i explained to him that I am a proactive trader,i am not an investor.
He has no great time or intrest in been pro active with this,passive to say the least,i'm temped to tell him just to give it to Warren(and Charlie) ,I'm a huge fan of statistics and probabilities ,and looking at Berkshires track record,can any of ye tell me why not ?

Value Hunter

Biggest obstacle now is their sheer size, Berkshire are a victim of their own success.

Very hard to grow $300 billion at 50% annually

I'm sad to say I think the days of spectacular growth and still having safety/low risk are gone for Berkshire investors

It's becoming a case of trying to beat the market by a few percentage points every year, yet the risk would be much lower in my opinion


If you gave Buffet $1 million to invest he'd beat anyone, but he's handicapped by his size

arrowloopboy

Value Hunter wrote: »

Biggest obstacle now is their sheer size, Berkshire are a victim of their own success.

Very hard to grow $300 billion at 50% annually

I'm sad to say I think the days of spectacular growth and still having safety/low risk are gone for Berkshire investors

It's becoming a case of trying to beat the market by a few percentage points every year, yet the risk would be much lower in my opinion


If you gave Buffet $1 million to invest he'd beat anyone, but he's handicapped by his size

This chap would be extatic with 15/20 % annually ,the guys at the bank are trying to sell him some different class of rubbish every time he's in:rolleyes:.

aidanki

how about the baby berkshires

arrowloopboy

aidanki wrote: »

how about the baby berkshires

Which ones Aidan ? (Blue ?)

lucky john

Value Hunter wrote: »

Biggest obstacle now is their sheer size, Berkshire are a victim of their own success.

Very hard to grow $300 billion at 50% annually

I'm sad to say I think the days of spectacular growth and still having safety/low risk are gone for Berkshire investors

It's becoming a case of trying to beat the market by a few percentage points every year, yet the risk would be much lower in my opinion


If you gave Buffet $1 million to invest he'd beat anyone, but he's handicapped by his size

Two other factors as well. Once he or any of his people show an interest in a company the price shoots up so shrewd deals are hard to come by these days. For the first few decades of his investing life he locked himself away and analysed reams of company info all on paper. He then used his massive mathematical mind to pick companies with hidden value. Now the same info is available on your smart phone so he doesn't have the advantage of almost fanatical dedication on his side.

arrowloopboy

lucky john wrote: »

Two other factors as well. Once he or any of his people show an interest in a company the price shoots up so shrewd deals are hard to come by these days. For the first few decades of his investing life he locked himself away and analysed reams of company info all on paper. He then used his massive mathematical mind to pick companies with hidden value. Now the same info is available on your smart phone so he doesn't have the advantage of almost fanatical dedication on his side.

So are you saying NO John ?,for a long term passive investment.

lucky john

arrowloopboy wrote: »

So are you saying NO John ?,for a long term passive investment.

Warren Buffet would definitely be someone I have huge admiration for. Unfortunately he won't live forever and no matter who the chosen one is the day he retires will be a black day for Berkshire. As a long term investment I would say NO and at the same time love to be proved wrong.

bappelbe

Buffett himself recommends putting into an index based mutual fund or etf:
http://www.fool.com/investing/general/2013/12/30/warren-buffetts-super-simple-retirement-advice.aspx

I think you will be paying more for your fund management than indicated here (I see most funds I read about charging 1-2% per year as opposed to the 0.15% or so in vanguard)
Also your friend might want to remove currency factors by using a Euro based fund and not the S&P though I am not sure how this would affect him in the long term