Whats the point of investing when Buffett will do it for you?

[imported_bingobazza]

Seriously. Why bother doing the work yourself if you can buy berkshire Hathaway non voting shares for aroung $3000 a pop (assuming you want growth and not income).

And he will do a better job than you, unless you're deluded, a genius or lucky.

[WarmonkEd]

BRK has a huge amount it needs to invest in order to get a decent return. It's harder to earn a 10% return with $40 billion, than it is with $40,000.

[imported_bingobazza]

i agree, but when he has earned 28% over 30 years with less, 15% is possible...and thats acceptable to me these days. Any other reasons?

[eastbay]

[ QUOTE ]
i agree, but when he has earned 28% over 30 years with less, 15% is possible...and thats acceptable to me these days. Any other reasons?

[/ QUOTE ]

Sure. You're looking for a different risk/reward profile than he's offering.

eastbay

[imported_bingobazza]

[ QUOTE ]
[ QUOTE ]
i agree, but when he has earned 28% over 30 years with less, 15% is possible...and thats acceptable to me these days. Any other reasons?

[/ QUOTE ]

Sure. You're looking for a different risk/reward profile than he's offering.

eastbay

[/ QUOTE ]


eastbay

Lets say for the sake of argument that Im not....and that 15% (or the S&P index plus 5%) a year is fine for me. In that case, is there any logical argument for doing the work yourself?

What activities that carry more risk than putting all your money into one stock would you NOT consider to be specualting?

Bingo

[James Boston]

[ QUOTE ]
you can buy berkshire Hathaway non voting shares for aroung $3000 a pop

[/ QUOTE ]

Is that the only difference in the 2 classes of BRK? I really don't know.

To your question... I guess you would need to look at BRK the same way Buffett looks at everything he buys. I haven't, but it could be very over-valued. This doesn't sound unreasonable considering how highly esteemed Mr. Buffett is.

[AceHigh]

Fees...not as good lately. 20%/year would double you money in 4 years, here is the 5-year chart for BRK-B.

http://finance.yahoo.com/q/bc?s=BRK-...amp;q=l&c=

[imported_bingobazza]

still not bad compared to this chart

http://finance.yahoo.com/q/bc?t=5y&s...=&c=%5EDJI

and this ones a train wreck in compaison

http://finance.yahoo.com/q/bc?t=5y&s...&c=%5EIXIC

[imported_bingobazza]

[ QUOTE ]
[ QUOTE ]
you can buy berkshire Hathaway non voting shares for aroung $3000 a pop

[/ QUOTE ]

Is that the only difference in the 2 classes of BRK? I really don't know.

To your question... I guess you would need to look at BRK the same way Buffett looks at everything he buys. I haven't, but it could be very over-valued. This doesn't sound unreasonable considering how highly esteemed Mr. Buffett is.

[/ QUOTE ]

Berkshires A shares are expensive for a very good reason...to promote a direct link between the underlying value of the business by discouraging short term trading, which buffett despises, and to encourage long term ownership. I think 2%-10% of shareholders change from year to year. The B shares came in to facilitate 'gifting' by long term shareholders, and also for tax purposes that I dont understand, as Im not a US citizen. They are 1/30 of the A shares.

Check out the intrinsic value for the A shares here (I use the liquidation model), and divide by 30 to get the value of the B shares. You should find that the variance from true value is never that much. The long term nature of the owners of the shares essentially make sure that there is never a specualtive bubble in the share price.

http://www.creativeacademics.com/finance/IV.html

Bingo

[AceHigh]

Good point...looks like he is beating the market average for last 5 years. I'm sure a Buffet fund will perform at least acceptably for you.

Current year is a little disappointing:
http://finance.yahoo.com/q/bc?t=1y&s...=&c=%5EDJI