In last weekend’s annual Berkshire Hathaway shareholder meeting Warren Buffet said some pretty entertaining things. Three of my favorites were…
1. When addressing his addiction to junk food he said, “I have not seen evidence that convinces me that it’ll be more likely to reach the age of 100 if I suddenly switch to water and broccoli.”
2. “It is possible for one person to live their life ONLY using products owned by Berkshire Hathaway.”
3. When addressing the subject of age (Buffett is 85 while Munger is 92) Buffett said, “Charlie is always the one who gets the girl and I have one explanation for that. As you know every mother in this country tells her daughter at an early age: If you’re choosing between two very old and rich guys pick the one that’s older.”
But one of the most interesting (at least for serious investors) was when he went on his predictable annual rant against Wall Street.
As thousands watched during the live webcast last Saturday, Buffett updated attendees on a bet he made back in 2006 with a little-known hedge fund group called Protégé Partners.
About ten years ago this hedge fund challenged Buffett to a bet that the overall returns of their five handpicked funds would outperform the market (the S&P 500 Index) over the next 10 years.
Buffett could hardly contain his smile when he revealed a chart showing the comparison since 2008. The S&P 500 Index Fund gained 65.7% vs just 21.9% for the hedge fund’s hand-picked investments. It wasn’t even close.
“Hiring Professional Money Managers is a Huge Minus”
Buffett went on to say, “Supposedly sophisticated people, generally richer people, hire consultants, and no consultant in the world is going to tell you ‘just buy an S&P index fund and sit for the next 50 years.’ You don’t get to be a consultant that way. And you certainly don’t get an annual fee that way.”
Editor’s Note: PhD beats Buffett 329% to 169% since 2003—without trading.
He went on to say that, “Investing in an S&P 500 Index fund gives you the best record of all American business which has done incredibly well over time. The net result of hiring professional management is a huge minus.
A little later Buffett sidekick and Berkshire Vice Chairman Charlie Munger chimed in with his own shameless plug…
“You’re talking to a bunch of people who have solved their problem by buying Berkshire Hathaway,” he said. “That worked even better.”
“From 1965 through the end of last year, Berkshire shares have risen 1,598,284%, compared to the 11,355% return on the S&P 500.”
Munger then said, “There have been a few investment managers who have actually beaten the market over the long term, but it’s a tiny group. It’s like looking for a needle in a haystack.”
Invest Like Warren Buffett—and Take it to a Whole New Level
One of those managers is Dr. Joseph Belmonte, creator of our brand new course, The Buffett and Beyond Stock Selection Method.
From 2003 through 2015 Dr. Belmonte’s portfolio has beaten Buffett’s Berkshire Hathaway 329% to 169% WITHOUT trading or using risky strategies like options, leverage, penny stocks, or going short.
In fact, he owns many of the same global dominating brands that Buffett does, mostly S&P 500 household-name stocks, and simply rebalances the portfolio once at the end of each year.
In 2016 Dr. Belmonte’s Buffett and Beyond Dividend Growth and Income Portfolio is off to a great start beating the S&P 500 by more than 850%!
So if you like investing the Warren Buffett way congratulations! You’ve made a wise choice and are following one of the greatest investors of all time.
But if you’d like to take what Buffett does to the next level, I encourage you to discover the little-known loophole used by Dr. Belmonte that has allowed him to beat Buffett at his own game since 2003.
Click here to see exactly how he does it—and how you can too.
Weiss Educational Services