Editor's Note: A previous version of this article mistakenly described the prices in the "Buffett Paid" column of the table as the basis paid by Berkshire. We regret this error.
"If I have seen a little further, it is by standing on the shoulders of giants."
-- Sir Isaac Newton
Warren Buffett. George Soros. Carl Icahn. Bill Miller. These names ring out among the giants of investing -- names of highly admired people with records to aspire to.
For years, Foolish investors have tried to tap into their genius by immersing themselves in their biographies, studying how they invest, and, with the advent of the Internet, trawling through their Form 13-F filings for hidden pearls of Foolishness.
Great news
That last step, at least, just got a whole lot easier, thanks to the magic of Motley Fool CAPS -- which is quickly becoming the Fool's Swiss Army knife for all things investing. In our latest upgrade, we've added 41 new, virtual players to the 86,000 real-life investors whom we track in CAPS. Among our new contestants are -- who else? -- Warren Buffett, George Soros, Carl Icahn, Bill Miller, and three dozen other members of the investing elite.
WWBB? -- what would Buffett buy?
We begin our examination of the masters with the biggest name on that list: Warren Buffett. Reviewing the holdings of his investment vehicle, Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B), we quickly learn that the world's greatest investor finds value in places where no one else is looking. (I know. Shocker.)
Buffett does own plenty of stocks that investors love -- Nike, Procter & Gamble, GE -- he's also accumulated stakes in quite a few companies that many investors hate.
But don't take my word for it. With CAPS, you can see for yourself:
|
Company
|
CAPS Says
(5 Max):
|
Buffett Says:
|
Buffett Paid:
|
|
Wells Fargo (NYSE: WFC)
|
***
|
15.14%
|
$28.21
|
|
Bank of America (NYSE: BAC)
|
***
|
0.70%
|
$39.22
|
|
American Express (NYSE: AXP)
|
***
|
13.68%
|
$44.50
|
|
Home Depot (NYSE: HD)
|
**
|
0.21%
|
$25.39
|
|
SunTrust (NYSE: STI)
|
**
|
0.37%
|
$61.44
|
|
M&T Bank
|
**
|
1.05%
|
$72.42
|
Data derived from Berkshire Hathaway's public filings with the SEC. Data current as of Sept. 30, 2007.
"Buffett Says" describes the proportion of Berkshire Hathaway's equity portfolio invested in the named stocks.
"Buffett Paid" is the price at which the stock was entered into the CAPS tracking portfolio, not the basis of the actual purchase by Berkshire.
Is the view any better up there?
So, perched on Buffett's shoulders, as it were, what can we see from up here? According to the ratings from the 86,000 investors on CAPS, half of the stocks on the list are long-term losers; the other half can be expected to do little more than pace the market's returns. Little wonder -- with the exception of Home Depot, every stock on this list is a bank, and we all know how the financial world has suffered lately.
Yet here we find a man with something on the order of seven decades of investing experience, and what's he buying? Financials. And not only is he buying them -- he's sunk 15% of his company's money into one (Wells Fargo), and nearly 14% into another (AmEx).
It makes you wonder what Buffett knows that the rest of us don't. Or if it doesn't make you wonder, it should.
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