Why Warren Buffett likes elephants and moats
Warren Buffett: Berkshire Hathaway cash pile rises $100M per business day
FBN’s Liz Claman talks to billionaire Warren Buffett about Berkshire Hathaway’s massive cash pile.
Warren Buffett is the fourth-richest man in the world and you don't rise to that level without a few savvy moves.
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With an estimated personal net worth of $90 billion, per Forbes, the down-to-earth investor has built his portfolio with household names and proven earners.
His Berkshire Hathaway was worth $231.6 billion as of this year. Among his biggest holdings: Apple, Coca-Cola, Bank of America, American Express and Wells Fargo.
|BAC||BANK OF AMERICA CORP.||34.36||-0.49||-1.41%|
|AXP||AMERICAN EXPRESS COMPANY||134.90||-1.68||-1.23%|
|WFC||WELLS FARGO & COMPANY||47.70||+0.36||+0.76%|
Earlier this month he assumed a new position in Kroger and has been steadily building positions in airlines, including Southwest and banks such as JPMorgan.
|LUV||SOUTHWEST AIRLINES CO.||56.53||-0.41||-0.72%|
|JPM||JP MORGAN CHASE & CO.||135.81||-1.68||-1.22%|
BUFFETT'S 5 BIGGEST STOCK HOLDINGS
While he doesn't divulge the precise way he and his team select investments, he has discussed over the years some of his top criteria which include two key characteristics, one of which is a moat.
Many average folks may think of a moat from the perspective of a king or a queen in a castle. A moat surrounds the castle and acts as a protector. A moat in the corporate world functions in a similar way. It means your business is likely the very best in its field and set far apart from weaker competitors and untouchable from a competitive stance.
“In business, I look for economic castles protected by unbreachable ‘moats.'”
"In business, I look for economic castles protected by unbreachable 'moats,'" said Buffett in his 1995 letter to shareholders. At the time, he gave a shoutout to his insurance company GEICO for being that moat.
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At the time, GEICO boasted 3.7 million auto insurance customers. Today, that figure has risen to more than 17 million, according to the company.