Dynamic

Not sure of the date. I read that rule 13 specifies within 45 days from the end of the quarter for 13-F disclosure, so I think it might even be tomorrow, Thursday 14th Feb. I imagine they'll leave it as late as possible to delay releasing information that may compromise their ability to keep purchasing new positions at cheap prices. Looking backward over the last year we have the following four quarterly 13-F filing dates: 2018/11/14 = 31inOct + 14inNov = 45 days after 2018/09/30 quarter end 2018/08/14 = 31inJul + 14inAug = 45 days after 2018/06/30 quarter end 2018/05/15 = 30inApr + 15inMay = 45 days after 2018/03/31 quarter end 2018/02/14 = 31inOct + 14inNov = 45 days after 2017/12/31 quarter end Looking at that, in the past year it's always exactly 45 days, so unless it's a non-working day or non-trading day and it gets brought forward to the working/trading day before, I imagine it will always be Valentine's day for the first of the year, 15th May for the second and 14th Aug and 14th Nov for the others. Any later without good reason or special dispensation and presumably Berkshire would fall foul of the SEC. However, I've seen people posting elsewhere (e.g. comments about Apple on a Charlie Munger fans' Facebook Group) that they think it will be Friday and I think I've seen it elsewhere too in comments. Mind you, I wouldn't expect most people care enough to be aware of the 45-day rule and they're probably more used to the idea of publishing the 10-Q and 10-K filings on a Friday or Saturday after the markets have closed for the week so that everyone has time to digest them. I'm strongly guessing late on 22nd February for the 10-K, though I'm not sure what the rules are and whether it could even extend to 1st March. The other one I've read a little about in the filings seems to be 13-D and 13-G type filings. These apply where more than 5% of a class of stock is owned and I believe they have a much shorter time period (might have been 5 or 15 days or trading days) before they must be filed after the transition across the 5% barrier either way is known, when certain material events happen (e.g. Knauf's offer for USG), or when the percentage changes by about 1%. Sometimes, assuming Berkshire has not received an exemption from public disclosure for a specific position so long as they tell the SEC, we might be able to infer that a certain amount of buying has NOT happened within a certain period. For example, that they have not bought another 1% of Apple's outstanding common stock in the first part of January, which would not have been disclosed on tomorrow's 13-F.

Thank you, and by extension, thanks go to all those who've contributed in this thread. I'm glad it's useful to people who want to look at it truly from a look-through ownership perspective. It actually has a few advantages when you get a 10-Q before the 13-F too, as Berkshire reports the value of its largest positions at quarter end Still, if it can be improved a little, by taking account of a few small factors like BHE's minority ownership's look-through proportion of BYD, I'd be glad to improve it. On my COMBINED HOLDINGS sheet that would simply require a formula in cell I40 such as =0.9*225000000 (or just the value 202500000), though I prefer the first option as it explains why it's less than shown in the 2016 Annual Report even if the comment gets deleted.

Yeah, it took a bit of learning and guesswork and comparison to other sources to reverse engineer what I'd done wrong before I internalised how these filings are laid out. Good luck with your adjustments, John. And I cannot thank gfp enough for the guidance, particularly early on in the process. Eventually, after noticing some 13-D or D/A and 13-G or G/A filings mentioned the pension funds, I decided to trawl back through those sorts of filings for a few years and it made the beneficial ownership to Berkshire shareholders pretty much match up with the figures shown in the annual reports, so I was fairly sure those adjustments were correct. I think there may still be small discrepancies. For example, Berkshire Hathaway Energy holds the BYD stake and is (from my memory) 90% owned by Berkshire. It may be that we should account for the 10% minority stake in BHE when working out our true look-through ownership. I'd be interested in hearing other people's views on that, but I think the spreadsheet is already better than most sources that ignore NEAM and pensions for estimating our Look Through ownership.

Hi John, If you want to compare figures to mine, I do include all lines I've extracted from each 13-F in columns in my tabs (usually 6th and 7th tab) called BRK ONLY 13-F LATEST and NEAM 13-F 01 02 items. The first one I found out where the discrepancy arose is Wells Fargo, and I've stopped there for now. I imagine the others could be similar. There appears to be an error on the cover page primary_doc.html of just the November 13-F filing for New England Asset Management, which I hadn't noticed until now. I believe it usually lists under List of Other Included Managers: 1 and 2, but in this case appears to have put: 1 BERKSHIRE HATHAWAY INC and 1 GENERAL RE CORP which should be number 2 as per previous 13-F filings I've seen from them, I would think, and as user gfp ('globalfinancepartners' at the time) has explained to me in previous posts long ago on this thread. On the information table of the 13-F it is ONLY where the MANAGER column states 01 02 that you should include this as a Berkshire Hathaway holding. The 39,467 shares of WFC discrepancy in the Nov 2018 13-F do not show 01 02 in that column, so you should not have included them in your total held at New England Asset Management if my understanding is correct. As you're pasting the data from the 13-F, there are a couple of ways to process the data. You could Conditional Format cells in that column if they contain the text "01 02" to be a different colour or background colour. Fortunately, there's only ever one line of "01 02" Berkshire holdings for any stock on the NEAM sheet (unlike the Berkshire 13-F which has a variety of different managers and combinations of managers within subsidiaries) Or you could add a column of your own for BRK holdings or do a conditional SUM such as SUMIF or SUMIFS. For example, in a new column, say column M, you could put a formula in cell M4, then autofill down the rows of this form: =IF($I4="01 02",$E4,"") When I just did that, none of the rows you highlighted pink gave a number, so I think that's the source of the discrepancies you have. You could also filter the table to show only "01 02" in the Manager column, and it should be fine and agree with mine. Certainly none of the pink rows show up when I filter that way. When I input the 13-F holdings onto my sheet, so that you can easily compare mine and yours to check for errors in either, I put them in two worksheets (6th and 7th tabs) called BRK 13-F LATEST and NEAM 01 02 items. In there I put the various rows applicable to Berkshire into columns and add up the numbers to get the total holding. For historical data and to assist in showing quarterly changes I also keep old copies of the 13-F filing sheets. The 5th tab is COMBINED HOLDINGS and includes both BRK and NEAM figures from their respective sheets and any adjustments for other holdings or deductions for Pension Fund holdings, along with a link or descriptive text to explain the adjustments or the source of that information. With Pension Fund holdings I usually keep the sum of all the pension fund holdings as a formula so that I can easily change such holdings in the formula bar if certain funds change their holdings and compare one 13-G filing to another to spot any adjustments. BTW, I agree that pasting from the HTML page into Excel or other spreadsheets can be terrible. It's made worse for many non-English speaking countries who use . as a thousands separator and , as a decimal separator, so your locale defaults mess with it even more! Fortunately, there are no US format dates to worry about! Maybe I'll one day implement something to parse the XML format (which I think is JSON data) and automate as much as possible, though I'm sure there may still be problems such as a mis-spelling of MONSANTO as MOSANTO a few quarters ago that will need manual intervention at times, though the CUSIP number might allow automation to work better. Perhaps USB and BK will still have discrepancies after you've removed non "01 02" figures from NEAM, and if so, let me know and I'll see if I can spot the reasons. Thanks for your analysis and problem spotting.

It certainly sounds compelling. It sounds like it will be simple, involve low administrative overhead and appeal to small business owners for whom insurance is necessary but not worthy of too much attention, and will be backed by Berkshire's financial strength, and from Berkshire's point of view it will capture 3 premiums in one hit, with one set of administrative overhead and no brokers' expenses thanks to the direct sales model. They suggest a 20% typical saving over bundled policies. I didn't see anything in the FAQ about what happens if renewal dates are different for different cover under a business's existing arrangements. I could well imagine that auto insurance or premises insurance might vary, though I'm not all that familiar with how these things are done in the USA. In the highly competitive UK personal market, products like Admiral Multicover allow you to cover home and car according to their respective renewal dates and obtain a discount (though you can usually do better by shopping around for separate policies from different insurers, typically via comparison website that earn referral fees) but the two policies remain separate, just with the same provider. I'd imagine that if the renewal dates do differ, THREE could quote an effective annual premium (so they know what to expect for the whole year) then take on cover from the renewal date pro-rata for the remainder of the year to bring them all into line, and send email reminders to the insured to make sure they lapse their other policies when they expire. I can imagine there's also a little scope in a similar fashion to simplify the lives of residential building managers like apartment/condominium companies, or what in the UK we call Resident Management Companies (a Landlord usually owned by the apartment owners) or Right To Manage Companies. Typically, in the UK, these companies require Buildings Insurance (with optional Terrorism cover) which usually includes Employee Liability (workers' comp, covering contractors such as cleaners, handymen and gardeners if they get injured at work). Plus, if they have elevators, they'd require Engineering Insurance (which mainly covers 6-monthly inspections to ensure safe operation and has only a few competing insurers) and they'd normally want Directors and Officers Liability insurance to cover the company officers such as Directors and Company Secretary (who are frequently flat-owners too). However, the costs of buildings insurance are usually around 10x higher than the other two, so I'm not sure how much additional float and underwriting profit could be gained, though the administrative overhead reduction and direct sales approach should still enable decent savings, and the simplicity of a single policy at a competitive price may make the product sticky and encourage regular renewal, especially when the Directors run the building for free in their spare time.

Thanks for spotting that, John. All fixed now. I probably didn't notice that I'd omitted to copy the formulae from the cell above or below when I inserted it on the Look Through summary sheet as I usually look at the front sheet instead and not the Summary. Something else happened the other day with Coca Cola (KO) (on my private copy at least), where GoogleFinance was throwing an error and reporting its currency as ARS (Argentine Sol) but that just got sorted out. So, as always, be careful before using this sheet to inform investment decisions. It's possible that errors will be present from me or from GoogleFinance. I'm glad people are finding the sheet useful and please feel free to point out any problems you spot.

I'm not sure it is worth another topic, and I'm generally happy with BHE's sizeable investments into renewable energy, which are quite rapidly supplanting fossil fuels and interest in grid scale storage along with their focus on efficiency as well as meeting the expectations of their regulators and customers. I'm just pointing out that those sort of things tug at my skeptical alarm bells and make me wonder if all is as it seems.

Yeah, I do like the simplicity of Berkshire's website. Simple but effective and probably edited rarely as a minor part of the work of one person's job at HQ. Leave the flashy sites to the subsidiaries.

Yes, it's new. It wasn't there on Jan 30, 2019 but was there from Feb 1st, 2019. Good spot, John. Maybe they'll notice the typo in the link to Berkshire Hathaway En[glow=red,2,300]g[/glow]ergy Company soon. Clicking on that link, I notice that the Property Plant and Equipment is show in Coal, Natural Gas and "Renewables and Other". Something in me makes me treat such categories with suspicion. It makes it sound like it isn't just energy generation and storage assets, but also distribution assets, offices and so on, which seems a little disingenuous if true. Also, the assets for solar and wind may cost more up front but with no ongoing fuel costs, and now even with grid scale storage, they work out cheaper per kWh in the long run, so I think it may be a little misleading superficially.

The 13-F only tracks US Listings and shows he held only Alibaba and Baidu stocks traded in the US in unchanged quantities at 30 SEP 2018. It is not intended to disclose holdings to track portfolios - this is merely a side effect of the disclosures. It's clear that the BYD stake for example is held in Hong Kong or another Chinese market like Berkshire's and will not appear in 13-F filings

Hope it's not too far off-topic to post here, but I noticed when reviewing Wikipedia's list of requested photos of people, that at least two names relevant to Berkshire Hathaway were there (and I've only been skim reading until part way through the B's): Rose Blumkin, late founder of Nebraska Furniture Mart and Susan Alice "Susie" Buffett, philanthropist and daughter of Warren Buffett and the late Susan Thompson-Buffett. I think she's the one who remarked that as a child she told a teacher she thought her father worked in burglar alarms. He'd told her he was a Securities Analyst. :D If anyone has any that they took themselves and are willing to release on a suitable copyright-free licence to Wikimedia Commons, they might make a good addition to their Wikipedia biographies. It's easiest if the copyright-owner submits the photos but I think I know enough to help guide you through the process. And now back to your regular scheduled programming...

I think having that expectation in mind before you start your analysis is key. 1. Having the mindset that most of the businesses you'll look at will be rejected on the basis of business quality or your ability to understand and value it (unless you're finding them by looking at the picks of other great investors who may have filtered your list for quality already). Your work has still been valuable if you've avoided a mistake and rejected something that doesn't put the odds strongly enough in your favour, either ever, or at least at its current price. It may also give you insight that you can carry into future analyses that will benefit you later. 2. Having the mindset that you will value it independently of its market price and insist upon a wide margin of safety before buying, so that you're likely not to find it at a price you're willing to pay and you'll to have to wait until the market goes crazy and beats it down excessively to a good discount before you take a large position. 3. A possible exception to 2. is companies of the Phil Fisher type where you have high conviction they will compound at high rates for a decade or more beyond what's priced into the stock and you have the benefit of time-frame arbitrage in your favour due to your long time horizon and doggedness in holding on despite market peaks and troughs. Perhaps the likes of Amazon and Alphabet/Google fit this, at least in the past. Even with those, it's often best to wait until they have a temporary setback and get repriced as if they're not going to grow as fast before you really commit large sums to them, especially if you have some relatively recent history of such setbacks as a guide to the typical valuation ratios available at such times. There is of course the chance you'll miss out. 4. A few companies will be those you haven't analysed deeply yet, but you become aware that they've been surprisingly cheap for a little while on the surface and may be worth investigating to see if you feel you can value them and decide how much you could risk in taking a position. You'll probably still have some days or weeks to try to get an understanding of the business before the price changes significantly (especially if you know that major earnings releases or product launches that might spark a re-rating aren't imminent). If you can still manage to assess them honestly, and overcome the fact that you have a strong inkling in advance that they're undervalued, these can be the times when your research effort can result in a fairly swift decision to purchase a truly meaningful position at the current price and can have a substantial impact on your future wealth. Essentially, don't forget the idea of having a punch-card allowing you only 20 trades in your investing career. If you had such a restriction, you'd focus on your best ideas in sound long-term businesses when you consider they're deeply undervalued and thus have a low risk of permanent loss of capital and a high prospect of substantial gains. And being limited to 20 trades, you'd put a meaningful proportion of your portfolio into such positions. For me, with the time I devote to it and my limited circle of competence, these sort of high conviction ideas are truly rare - perhaps just a few in a decade or two. There's one stock that was getting to around 10% above my large-margin-of-safety target buy price very recently (a price that should provide an OK return even if the business languishes for the next 5-10 years, so long as it doesn't decline too fast). It has since recovered a little along with the general market and is now about 20% above my target. It might fall again in the coming months and reward me for my patience, or I might miss out on an opportunity to obtain perhaps 40-80% total return over maybe the next 2 to 4 years, versus maybe 50-100% total return if I do get it at my target price. I could have potentially benefited a little from my willingness to purchase a little below the recent market price by writing some put options at my desired strike price in the style of boilermaker75 (either keeping the premium or getting the stock if the price falls enough to get put to), but as it happened, the tax-free account where I had the funds available to deploy doesn't allow me to use options, so I missed out on that specific opportunity on this occasion (though if I can buy it eventually at my desired price and reap 50-100% gains in 2-4 years without capital gains tax, I'll more than make up for the short term 1-2% gain from writing the puts that I have foregone).

As a net buyer of Berkshire over the years, generally ploughing new cash and excess gains I make from those rare high conviction ideas elsewhere in Berkshire's direction in the end, I'm happy for this to persist for a long period of time, at least until my retirement and probably much longer. Berkshire being persistently undervalued and misunderstood makes it easy for me to have great comfort in buying the stock at modest prices and holding on even as prices rise and narrow the margin of safety, both as a long-term compounding vehicle for my portfolio growth and as a substitute for index and cash investments while I'm waiting for my next big idea. One of the things that suddenly hit me when I was fairly new to investing and to Berkshire Hathaway was the idea that even companies with little or no growth opportunities could become valuable parts of Berkshire's compounding machine, simply by returning excess capital to Omaha for it to be invested in the best opportunities available at good rates of return. All parts of the machine did not need to experience compound growth for the whole machine to generate compound growth over the years. When no-growth boring companies are available at low P/E or low P/FCF ratios, the after tax cash they churn out year after year after maintaining their moats can be collected tax-free at Omaha and reinvested in ways that tend to aid in compounding the whole of Berkshire over time, even if that means great companies like See's Candies gradually fade into comparative insignificance over a few decades within Berkshire. Even decades after purchase, See's is churning out far more cash than needs to be reinvested in the business to maintain its position. If it had pursued significant geographical expansion thanks to a growth imperative handed down by its owners, it would almost certainly have resulted in lower returns on invested capital from Berkshire's perspective. The mirror to this approach is companies with sensible buy-back policies, potentially compounding per-share value for year after year with negligible growth in total revenues and earnings and with negligible expenditure required to generate growth or establish the firm in new markets. It's potentially these sort of places that value can be hidden in plan sight when everyone is hunting the next growth story.

Muscleman, kudos for knowing yourself and adapting to something you feel will work for you. To me, elements of your tender offer situations sound quite a lot like approaches to merger arbitrage and other special situations like work-outs that can be considered part of the spectrum of Value Investing, and I think there's a good chance that these sorts of situations can often end up providing a reliable return in a fairly market-neutral way without suffering so much from the ups and downs of the general market. It sounds like you're using indicators that might have some real predictive power (such as percentage take up of a tender offer) with some success and not purely relying on chart-reading. Knowing your own psychology is important, and I hope you'll find success. I started out with a buy and hold portfolio I barely touched for about a decade, but I've kept the bulk of my portfolio in companies within a very narrow circle of very high stability and certainty, not the sorts to have earnings collapses. I made one mistake where that did happen and I lost a lot before finally getting out, but more than compensated in other positions that have compounded well and were mostly bought at prices that suggested they'd barely grow at all. I now trade a little more actively and I'm very concentrated in a very few positions about which I have developed a good degree of certainty for the fundamentals and a reasonable feel for how the market prices tend to relate to fundamentals over time. As I'm well ahead of schedule for my goals, I do feel comfortable and sleep well when my positions decline substantially and/or quite suddenly on relatively minor news (or no news), particularly as this tends to be the times when I make most of my purchases and obtain most of my margin of safety and my out-performance, but I recognise the feeling of uncertainty and potentially panic and the feeling of the need to take action that sudden market swings can generate. These feeling start to bubble up in me on occasions but I usually manage to suppress them. This Value Trade approach (as I have been calling it) works for me too and keeps me interested while I try to remain strategically idle by pondering from time to time whether the disparity is wide enough to overcome my hysteresis and make the switch when I feel there's a sufficient margin of safety in obtaining more value than I'm giving up. I rarely if ever have held a stock at prices where I think the stock is actually overvalued (unless the story has changed for the worse), but I've traded a modestly undervalued stock for a more deeply undervalued stock more often than any other kind of selling activity I've undertaken so far. It appears from the relatively few times I've done so, that subsequent price action of both stocks has validated my decisions the majority of the time, but it's probably too few times to be sure its not luck. The other approach I've taken is what I'd probably call Quality Trading: selling lower quality stocks to buy higher quality or higher certainty stocks, often those with a better valuation floor at fairly similar price-to-intrinsic-value ratios. Sometimes this is when the story has changed for the worse, but sometimes I feel the story hasn't changed and it's just that now the better stock is available at a comparable price-to-intrinsic-value ratio to the worse stock. Sometimes I've had a somewhat better price-to-value, but maybe not so clear, combined with better downside protection, so I get a kind of combination Value-Quality Trade. That works for me and makes sense for me in my main positions, but I'm also habitually mentally anchoring myself to lower prices than typical market prices by tracking a "Low Valuation" for my positions and my portfolio, based on what I imagine might be their typical multiples at times of pessimism, so this tends to remain a lot more stable than the market price and to increase gradually over time if I do my job right. It's this Low Valuation that I am aiming to increase until the target value we can retire on and become entirely financially independent. It is certainly possible that in the drawdown phase, I may adopt of more diversified approach to the portfolio, but I don't think I'll be able to resist a few relatively big positions when those high conviction ideas come along.

If you ever get a chance to see Festival of the Spoken Nerd, which is the star of that video, Steve Mould, plus Helen Arney and Matt Parker, it's a lot of geeky fun. You can find quite a bit on YouTube.

It isn't on the spreadsheet. You'd need to calculate the portfolio value with the closing prices on the last trading day of that quarter which is not on this sheet - it's just the best estimate of the current live portfolio not the one at previous times

Welcome, TB, from me too. I agree with this. I've held Berkshire as the bulk of my portfolio (well above 50% at almost all times and willing to have it be my sole investment, which it almost has been at times except for minor positions) ever since I had the ability to by US stocks in July 2003 considering it to be a least somewhat better than an index fund in terms of reliably preserving and growing capital over the long term. Despite paying around 1.6x BVPS back then when perhaps I needed more patience, my original stake has been ahead of an equivalent tax-free stake in the S&P500 Total Return Index quite consistently since October 2007 and fairly close above and below the index even before then. I've added more since at lower P/BV and obtained a slightly greater internal rate of return than the original position. I actually took 95% of my Berkshire position to cash temporarily once, for non-investing reasons, but other than that it was always well over 50% for me. I considered the risks of Buffett and Munger's mortality or retirement modest enough back then not to worry me, especially given the diversity of subsidiaries gushing cash and being run almost autonomously. I did expect to be investing for many years more, allowing me to recoup any permanent losses, though I put the probability of serious permanent loss very low indeed, even if it might suffer a temporary hit on the loss of a key person. I am of the same opinion today, reassured by my perception of Todd, Ted, Ajit and Greg, but now anticipating that Munger and Buffett will probably not both be working for Berkshire in 10 years' time. I'm thinking it will continue to operate very well for quite some time (perhaps a decade or two) after the succession plan is required, before the culture is at risk of much degradation at all, during which time I'd expect it to have grown substantially in per-share intrinsic value compared to today. By that stage in my life maybe 2035-2050, I will be well into retirement and will be sure to have sufficient diversification that we can withstand positions suffering permanent impairment, even if it means accepting lower returns. In the last few years since I have resumed adding new savings rapidly and managing investments more actively, I have to some extent considered Berkshire to be my default option for new funds, giving reasonable downside protection if bought fairly patiently by waiting for a modest P/BV (it's rarely priced extremely high or extremely low so I never feel I'm paying too much for it) and providing remarkably reliable compound growth in IV and stock price over the medium and long term. If I then happen to find any of those relatively rare (for me) high-conviction opportunities, like Apple at $95 in May 2016 where I want to make a sizeable bet when the odds appear to be heavily in my favour, my general approach is that I am happy to fund those purchases that I expect to generate out-sized returns by selling some of my Berkshire holding, while keeping enough Berkshire to meet my retirement goals even if, say, much of my 25% position in Apple were to flounder and go the way of Blackberry or Nokia from their heyday to their decline. Given that BRK.B is always priced below my estimation of its IV, it often helps me to wait for a suitably large margin of safety in the alternative before I pull the trigger. Even if I'd held onto Apple until their price today amid plenty of worries once more, I'd still be 60.7% plus dividends up (and the Berkshire I sold at $140 to fund it is up 38.5% in USD without dividends, so it's still a 22% outperformance plus dividends). I quite often approximately track the alternative investment's market price versus Berkshire's in this way to judge whether I'm making good Value Trade decisions and how fast they're paying off (if they are) in market price terms compared to my default of holding BRK.B, especially if I funded it from my Berkshire holding. Luckily tax doesn't usually complicate the picture! I've then tended to revert to buying Berkshire instead when I close those other positions as I think their potential downside risk versus upside potential starts to look a little less favourable than Berkshire's. This way if these side bets (Value Trades) outperform Berkshire as I anticipate the usually will, I can usually end up owning considerably more Berkshire over time by reinvesting their capital, capital gains and dividends as well as my new cash savings into Berkshire. Berkshire being my default investment seems to have paid off so far, and has been well worth the time I devote to understanding it as thoroughly as I feel I need to and knowing that I'm getting it for a good price with fairly limited downside risk when I add. Others will have different strategies and taxation situations and different circles of competence, so your mileage will certainly vary. But this approach has worked for me, and for me it seems as though it's better for me long term than holding too much cash in fear of the bear, which it seems is always looming for a few years before it arrives, during which time Berkshire is likely to compound at 10% or so for a few years prior to an eventual 20-30% decline, maybe 50% in extremis like 2008-9 GFC, so I will usually be well ahead of the cash alternative when the bear finally arrives and still able to take advantage of bear market opportunities within my wheelhouse. Berkshire as my default holding with cash at modest levels allows me to be patient and sleep soundly knowing my capital is at work in a range of great businesses before I occasionally take advantage of what I feel are fairly rare and special opportunities within my small circle of competence when I happen to spot them. In all the 16 years I've held it, Berkshire has not been close to the legendary super-compounder of the 70s and 80s (nor did I expect this), but it's consistently been a very good option for preservation and safe compound growth of capital over long time periods able to take advantage of bear markets for a little extra upside, and as I've come to understand it better, I've mostly purchased more at prices where I rarely see the price go very much more than 5 percent lower than my last purchase, while not missing out very often on upswings by waiting too long (I think I slightly missed out in late 2017 when the price rose above $190 in anticipation of the tax cut before I invested about 10% cash, but I still beat the market by holding two of the largest beneficiaries so I can't complain). One of these days we will find out what happens when Buffett or Munger leaves the scene, but that could still be quite a time and quite a lot of compounding in the future, so I'll continue to hold an awful lot of my old faithful default option.

Yes, unfortunately, John my only minor error was in 2016 and its bite to late to change it to 50%+ (or for that matter to 20%+if I switched to USD currency)

Despite all the reservations regarding asset-types, leverage (and the reverse of leverage - excess cash and equivalents), currencies, calculations etc, I think the anonymous poll itself has probably been answered with surprisingly high honesty as internet polls go in the last 3 years and any miscalculation by one person has probably largely cancelled out opposite miscalculation by someone else. My own 2016 result should have been 1 bin higher than the bin I voted for, but it also receive a ludicrous 30% currency boost by virtue of the USD:GBP swing after the Brexit vote, a 11% penalty in 2017 and a 8% boost in 2018. The range is reasonably closely centered pretty close to the S&P500TR returns for each year, which is quite a tough competitor, with a modest but substantial spread and group of outliers in each direction. 2018 CoBF results - SP500TR returned -4.38%. Currently (after 203 votes) the distribution is centered around a peak (mode) in the -5% to -10% bin, with the -5% to 0% bin a close second, and a very slight skew to the positive side of the distribution, which seems pretty close to what we'd expect. 2017 CoBF results - SP500TR returned 21.83%. Peak (mode) of distribution is in 10-20% bin, but with a slight skew towards higher returns in the tails of the distribution, possibly with mean average close to S&P return. Value Investors might expect to slightly lag bull markets and outperform bear markets, perhaps explaining why the mode was just below the 20-30% bin. 2016 CoBF results - SP500TR returned 11.96%. Peak (mode) of distribution is in 10-15% bin, but with a slight skew towards higher returns in the tails of the distribution so it looks like we slightly beat the index on average as a group. I think Berkshire's 2015 closing price probably helped quite a few of us. For a few of us currency effects were enormous (+30.0% benefit for my USD:GBP conversion, compared to -10.7% in 2017 and +7.8% in 2018). I certainly agree about calculations and about reporting bias. We should be careful not to be envious and dispondent, nor smug and overconfident in comparison to other people reporting their returns on the internet (even if it is in a great place of self-reflection and honesty like CoBF, where biases are much more in check than most forums) nor to assign too much weight to the distribution that a poll like this provides, which does look like it is reasonably well centered around the S&P500 Total Return over the last 3 years, but with a fairly broad spread and a few outliers at the extremes. And we should certainly be the masters of our own internal scorecard where we have our own goals and objectives and our own risk profiles which may differ wildly from others. Indeed, for concentrated investors years might pass between one very high conviction idea and the next, but by allocating significant capital to them when they arrive, substantial out-performance may arise in the long term, despite regular under-performance from year to year. Some may aim for safety above all else, some may risk a lot of their current capital in highly concentrated high conviction positions knowing they have many years of future savings to make up for any losses or simply being accepting of wild volatility in the style of Charlie Munger's early superinvestor career, some may insist on enough margin of safety to reduce risk of loss and simultaneously increase their prospects of outsized gains but on the flip-side they spend long periods in cash waiting for enough margin of safety. Some may have been exceptionally unlucky or lucky in the last year despite decent decision making considering in respect of long-term intrinsic value (in my alternative scenario I could have held AAPL and IBM as they went down over 20% and held onto WFC into the bear market, and didn't have the cash available to take advantage of the dip, so I feel I benefited from a lot of luck).

Rod, my rough guess of Book Value from the last known portfolio I track for Look Through holdings and earnings (trying to account for pension holdings and New England Asset Management's 13-F as best as I can) is that BRK.B BV/share ended 2018 on a small stock market recovery since Christmas Eve at just under $144 of Book Value per class B share, depending on actual operating company earnings after tax during the quarter, which might actually provide a little boost, so that would imply around $187 is your 1.3x BV figure, near enough. So it's not far below 2018Q2's BVPS. I remember BRK.B trading around $185-189 in late June 2018 before Q2 ended, and the previous quarter's BVPS was $140.79 (1.3x last reported BV was then $183.03), in a rising market, marking the low point for 2018. I added to my already high BRK.B exposure on 24th December 2018 when prices dipped as low as $187-189. In reality, I would expect that Intrinsic Value per share has actually increased since 30th Sep 2018, despite the decline in Book Value from the market value declines, so 1.3x BV now is a bigger discount to IV than it was then, in keeping with the declines in most of the market. And it's possible that Berkshire has been adding to positions on the way down, so they'll have lost a fraction more in Book Value than my estimate based on the 13-F as the market prices have fallen further, while nonetheless increasing IV by buying with a good margin of safety, assuming IV for each position hasn't taken a serious permanent hit and remains largely intact. Also, I'm generally assuming that any decline in market value of positions is partly offset by about 21% reduction in deferred tax liability when calculating the change in Book Value caused by the portfolio market price change. That might not be quite true for new positions that have declines to below their cost basis (e.g. ORCL), but will hopefully be roughly true for long-established positions with a much lower cost basis, which is probably the majority of Berkshire's portfolio, so probably roughly right. I could still imagine BRK.B going lower, the way markets have been behaving lately, and there probably won't be any rosy financials published in BV terms until the Annual Meeting weekend in May, but operating earnings might conversely have been exceptionally good this quarter, so I'm not predicting one way or another whether Mr Market will view the results positively or negatively.

I was lucky enough to enjoy a positive year from equities alone in both GBP (a 7.65% tailwind as GBP weakened) and USD, and also to do even better with an alternative investment opportunity for which I withdrew some funds, albeit producing taxable gains that my spouse and I will each need to pay a very modest tax rate on by 31 Jan 2020, unless I end up realising a lot of losses by April 5th 2019 when the UK tax year ends. I think I was very very lucky with timing on more than one occasion and benefited from a little skill in assessing the upside versus downside potential of what to sell and what to buy to increase the quality and the Intrinsic Value of my portfolio, probably by about 10-12% more than the market value increased, while reducing the downside risks in time and being lucky enough to obtain a good cash exposure in time for the 4th quarter bear market. The only tax paid so far was 30% US withholding tax on WFC, IBM and AAPL dividends within our tax-free ISA accounts in the first part of the year, as the provider doesn't support W-8BEN filing and their fees made were so much cheaper than alternative brokers that do support W-8BEN that it was a wash over the 2 years or so I held those three positions. Sold WFC@$55.70 and IBM@$151.50 in early Feb 2018, realising tax-free gains but having underperformed the S&P500 Total Return (SP500TR) with both positions, luckily modest in size and bought with a bit of margin of safety. Bought BRK.B at $192.69 with new money plus the proceeds of these sales. Topped up my BRK.B position slightly with more new cash in late March and early April around $195-$196, yet cheaper than the $198 paid in Dec 2017 as the pound had strengthened and dollar weakened at that stage. Sold my entire AAPL position on 24th May @$188.42, realising large tax-free capital gains of about 90%. If it weren't for needing the cash to withdraw and put into the alternative opportunity, I probably would have held a bit longer before I felt the price/intrinsic value ratio for BRK.B (fairly tight IV distribution) and for AAPL (slightly fuzzier IV distribution) was clear and wide enough to convince me to overcome my 'hysteresis' and make a Value Trade from one to the other, especially with what I felt was superior downside protection but still compound growth in BRK.B, but I had been thinking about where I should make such a trade for some months, which could probably occurred either with BRK.B in the $186-$188 region in July, while AAPL was near $200, or perhaps in September with BRK.B in the high $190s and AAPL around the $220 region, which would roughly have accorded with me feeling that I was getting more IV than I was giving up by a sufficient margin to be worth making the Value Trade. Also trimmed my BRK.B position to raise the remaining funds for the alternative opportunity in July/August. Realised substantial cash proceeds surprisingly quickly in time for the latest market dive, and got fully invested in the December bear market partly via some AAPL, BAC and WFC put contracts. Ended up realising modest losses on the AAPL and WFC (one was actually a tiny gain in GBP thanks to the exchange rate change in the meantime) to take advantage of particularly good prices on BRK.B lately, which saw gains to year end, and avoided the worst of the further AAPL decline. Now very slightly on margin, and exiting gradually by writing covered Calls at a range of strike prices and expiry dates, some already exercised and some due mid-January, which will either provide a good annualised return in premiums or will let me sell my excess BAC shares around the price I entered at. I might even roll the calls as they near expiry to obtain further option premium income and a higher eventual exit price, if the market moves suitably. Hat tip to boilermaker75 for the put/call writing methods of entering and trimming positions, which I feel I'm getting to grips with and benefiting from.

I think $169-$170 is likely closer to 120% of year end Book Value assuming today's prices hold for the remaining trading days, possibly a bit lower if they've been buying a lot of stocks and they've gone down further since. However I think Intrinsic Value will have increased a little since Q3 so today's price would still be attractive in the long run

I guess it depends on what kind of analysis you're trying to do. I used to wonder if there was a cash drag, perhaps compensated by its optionality to make opportunistic acquisitions and provide capital on attractive terms in times of distress, like the BAC convertible warrants. Now, in the light of some blog posts from a year or so ago that occasionally show up on Twitter, it seems quite sensible to compare the cash balance (minus the $20 billion kept in hand at all times to cover mega catastrophe losses) to insurance float. We know that float is long lasting, and at worst would probably decline about 3% per year, and more likely will continue to grow at about the same compound rate as the company overall (e.g. it's Book Value and Intrinsic Value) partly depending on market conditions for insurance and reinsurance. The long tail insurance lines seem particularly useful in ensuring long duration float persists, and the growth of GEICO while maintaining its low cost structure also contributes valuable, growing float at sub zero cost in the long run, thanks to wise incentives to maintain underwriting discipline rather than chase market share at the expense of such discipline Over the last 2 decades or so, float and excess cash balance have been remarkably close to 1:1 over most of the time, except at times of great opportunity, when the cash balance shrinks as it is deployed into very attractive acquisitions and partial ownership positions, warrants etc. Such times include 2008-9 Global Financial Crisis and other market crashes in the early 2000s. On another thread someone posted a comment from Buffett where an Annual Meeting questioner raised this point, and he said it was more coincidental than by design, but it seems clear that his prudent capital allocation has historically led to this approximate relationship. As such I now consider that cash is not a drag on returns as it's almost entirely money that Berkshire doesn't own, but gets to use until it has to be paid out. In times when exceptionally attractive prospective returns are available with a high margin of safety and very limited downside risk, this float funded cash may be largely used up generating returns far in excess of the cost of float (which has been negative for the best part of two decades now) and generating additional income that will rough the cash balance. The rest of the time in normal markets, float seems to generate a more modest positive return thanks to its sub zero cost and to interest on short term cash and treasuries that roughly match float. Berkshire seems remarkably consistent at growing both Book Value per share and Intrinsic Value per share at around 10-11% compound in the long term since rates became so low, plus a one time boost from the tax cut. This seems to equate to inflation plus 6-9% in my estimation, with particularly good returns coming after times of market distress. Most of the subsidiaries don't grow at such high compound rates as the whole of Berkshire, but generate so much free cash beyond their internal needs for capital and ability to reinvest it at attractive rates of return (the exceptions being railroad and utilities, which also get non recourse debt leverage due to their stability) that it gets invested into acquiring new business or shares in publicly traded businesses at those attractive rates of return. All the while, Berkshire has a diverse set of highly cash generative subsidiaries in many important parts of the economy coupled with prudent management that won't bet the farm to try to sustain targets on returns and growth - there are none - but instead waits patiently for the fat pitches and otherwise aims to preserve capital and sustain moats.

I decided to increase my BRK.B exposure further on the dip and sold my new AAPL position. I'm almost fully invested again now, having had a reasonable cash position for about a month.

I do like all these fairly well, but BAC more than AAPL or WFC at these prices. While I am not on margin, and actually still have some cash exposure, I have been thinking about your previous posts about getting onto 25% margin then getting off margin using covered calls. I've been thinking about this mainly if I get too much exposure, as selling covered calls is the other side of the same coin and is something I might well consider given the high annualised return available to have a few more bites of the cherry before I settle on the positions and exposures I want at really cheap prices. I might well place some orders and either earn some extra income on my positions or get called for a pretty good short-term profit, which has no more tax consequence in the UK than a long-term profit. Then I can return to selling puts for more income, which I might also do this week.