Stocks & Equities

Warren Buffett’s Apple stake hits record $159 billion as stock soars

  • Berkshire Hathaway’s Apple holdings of 887 million shares swelled to a value of $159 billion on Friday.
  • That makes the stake worth half of Berkshire’s entire equity portfolio, and almost 25% of its $649 billion market capitalization.
  • Warren Buffett started to build Berkshire’s position in Apple in 2016 and added to it up until mid-2018.

Warren Buffett is known for concentrating his investments to build generational wealth, and Berkshire Hathaway’s stake in Apple is no better example of that investment practice.

Berkshire’s 887.1 million shares in the iPhone maker swelled to a record value of $159 billion on Friday, a 342% increase from its original cost basis of about $36 billion. That means Apple is now worth more than half of Berkshire’s $293 billion equity portfolio, based on data from its third-quarter 13F filing.

And assuming Berkshire hasn’t trimmed its Apple position since September 30, the equity stake now represents about a quarter of Berkshire Hathaway’s $649 billion market capitalization.

What also makes Buffett’s concentration in Apple notable is that it didn’t take decades to compound like most successful investments managed by Buffett. Instead, it’s only been five years since Berkshire began to build its stake in Apple…read more.

Kevin O’Leary has gone on a crypto binge, but his investment fund has different ideas

Bitcoin’s massive swings aren’t for everyone, but one investing shark is hungry for more cryptocurrency: Kevin O’Leary.

The O’Shares ETFs chairman and Shark Tank personality bought his first coin in 2017 and has been picking up speed ever since.

“I’ve grown the portfolio remarkably,” O’Leary told his audience during a Reddit Talk session last month.

“At the beginning of the year, I was at 3% weighting. The target was to get 7% by year-end. However, because of the appreciation of so many of the assets I have now, we’re almost at 10% today.”

However, O’Leary’s largest investment fund, O’Shares U.S. Quality Dividend ETF (OUSA), doesn’t invest in crypto at all. Instead, it seeks businesses with strong profitability, balance sheets and dividend growth.

If you’re looking to diversify your crypto-heavy portfolio with income-producing stocks, take a look at the top three holdings of O’Leary’s flagship fund. And if none of those appeal, O’Leary also invests in plenty of alternative assets…read more.

  • Warren Buffett’s right-hand man Charlie Munger said markets are even crazier now than during the dotcom bubble.
  • “I wouldn’t want any one of them to marry into my family,” he said about people who invest in cryptocurrencies.
  • The Berkshire Hathaway exec said China is right to stamp down on bubbles and take a tough line on digital assets.

Warren Buffett’s deputy Charlie Munger has said markets are “even crazier” right now than they were during the dotcom bubble.

Munger blasted cryptocurrencies, and said those who invest in them are just thinking about themselves, according to the Australian Financial Review. He also labeled US millennials as “self-centered.”

The 97-year-old has been Buffett’s closest confidante for decades and is vice chairman of the sprawling Berkshire Hathaway conglomerate. He has a net worth of $2.2 billion, according to Forbes.

“The dotcom boom was crazier on the valuations even than we have now. But overall, I consider this era even crazier than the dotcom era,” he said in a Friday interview at the Sohn Hearts & Minds Investment Conference in Australia…read more.


Cryptocurrency ETFs ‘are not a winning strategy,’ expert says: There are better ways to diversify

If you’re interested in a particular investment area, such as, say, a sector of the stock market, you likely don’t have time to research every single company to determine which you think is best. Plus, even if you know your stuff, there’s still the chance that any investment in a single entity could go down dramatically. That’s why market pros recommend spreading your bets by buying a large swath of investments, thereby lowering the chances that your portfolio could tank due to a large drawdown in any particular position.

When it comes to traditional investments, such as stocks and bonds, a cheap and easy way to access that kind of diversification is often an exchange-traded fund, which holds a basket of investments, trades on an exchange like a stock, and usually comes with a small management fee.

If you’re interested in the world of cryptocurrency, however, an ETF is a less straightforward bet. Last week, the Securities and Exchange Commission rejected an ETF from fund firm VanEck that would have directly tracked the price of bitcoin. When it comes to cryptocurrency prices, “The SEC has fundamental concerns about the potential for fraud and manipulation,” says Ben Johnson, director of global ETF research for Morningstar. He added that you’re unlikely to see an ETF that directly tracks the price of crypto “until there are specific solutions in place to address those concerns.”

In the meantime, you can still buy one of several ETFs with “bitcoin” or “crypto” in the name, but they may not deliver the kind of investment you’re looking for — especially if you’re looking to diversify your crypto portfolio. In fact, as currently constructed, prominent crypto ETFs often see investors “effectively selling low and buying high,” Johnson says. “That’s not a winning investment strategy.”…read more.


Elon Musk says Raptor engine production is a ‘disaster’ that puts SpaceX at risk of bankruptcy

On Black Friday, SpaceX CEO Elon Musk sent an anxious email to his company’s employees, urging them to work over the weekend on SpaceX’s Raptor engine line and describing the production situation as a “crisis.” In the email, a copy of which was obtained by The Verge, Musk argued that the company faces a “genuine risk of bankruptcy” if production doesn’t increase to support a high flight rate of the company’s new Starship rocket next year.

The Raptor is SpaceX’s massive methane engine that will be used to propel the company’s next-generation launch system, called Starship. SpaceX plans to use Starship to take people to deep space, and in April, NASA awarded SpaceX a $2.9 billion contract to develop Starship as a lunar lander to transport astronauts to the Moon’s surface as early as 2025. SpaceX has been hard at work developing and testing Starship prototypes at the company’s test site in Boca Chica, Texas, though the company has yet to launch the vehicle to orbit.

SpaceX is currently hoping to conduct Starship’s first orbital launch in either January or February of 2022, according to a presentation given by Musk to the National Academies of Sciences on November 17th. However, according to Musk’s email, SpaceX needs to launch Starship at least once every two weeks next year to keep the company afloat. And apparently, Raptor engine development isn’t on track at the moment…read more.