Key insights
- The article discusses Warren Buffett's Berkshire Hathaway's portfolio concentration, with 67% in five stocks: Apple, American Express, Coca-Cola, Bank of America, and Chevron. While highlighting this strategy, the author advises against copying it directly, suggesting that investing in Berkshire Hathaway itself is a more accessible way to gain exposure to its diversified holdings and significant cash reserves.
According to the latest report, the stock portfolio of Berkshire Hathaway (BRKA +2.03%) (BRKB +2.06%), the company Warren Buffett built, had 67% of its assets in just five stocks. Should you copy that? My answer would be no. Permit me to explain why.
First, though, here are the five stocks:
Stock
Recent Market Value of Stake
% of Berkshire Portfolio
Apple
$57.8 billion
21.99%
American Express
$45.9 billion
17.43%
Coca-Cola
$30.4 billion
11.56%
Bank of America
$25.0 billion
9.52%
Chevron
$17.5 billion
6.64%
There are several reasons you might not want to copy Berkshire:
Of course, you might invest in all the stocks in Berkshire's portfolio in one easy move -- by investing in Berkshire Hathaway itself. You'll then be a part owner of dozens of wholly owned subsidiaries such as GEICO, Benjamin Moore, NetJets, Dairy Queen, McLane, and the entire BNSF railroad, along with lots of stock positions in various companies. Berkshire recently had close to $400 billion in cash, so further additions are likely in the coming years. Even Berkshire is buying Berkshire shares.