Berkshire trails red-hot S&P 500 by biggest margin so far this year
Berkshire Hathaway has underperformed compared to the S&P 500 this year, trailing by a significant margin. Warren Buffett expressed his preference for investing in industries he understands, such as soft drinks, over high-tech companies like Microsoft. He emphasized the importance of operating within one's 'circle of competence' when making investment decisions.
- ▪Berkshire Hathaway is lagging behind the S&P 500 by the largest margin this year.
- ▪Warren Buffett prefers investing in predictable industries like soft drinks over high-tech sectors.
- ▪Buffett believes that understanding a business is crucial for making informed investment choices.
Opening excerpt (first ~120 words) tap to expand
AUDIENCE MEMBER: I know you like to buy into success stories, but you don't like to buy high tech.And it seems to me, say, in the case of Microsoft, that 10 years from now they'll be doing software development, just like 10 years from now Coke will be selling sugared water.And what I'm wondering is, why you feel that way when it seems certain companies, high-tech companies, are predictable...WARREN BUFFETT: I think it's much easier to predict the relative strength that Coke will enjoy in the soft drink world than the strength — the amount of strength — that Microsoft will possess in the software world.That's not to knock Microsoft at all. If I had to bet on anybody, I'd certainly bet on Microsoft, bet heavily if I had to bet. But I don't have to bet.
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