Warren Buffett Couldn't Care Less About Tech Stocks

Discussion in 'Must-Read Interviews, Articles & News Items' started by Vidhi Khanna, May 29, 2016.

  1. Vidhi Khanna

    Vidhi Khanna Active Member Staff Member

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    Summary
    Berkshire Hathaway's stakes in Apple and IBM have been grossly overplayed and misunderstood by the media and investors.

    While it may appear Buffett has backed away from his consistent history of not investing in tech companies, there is more to the story.

    If you're a follower of Buffett, don't take this as a reason to start changing course and playing in the tech space, as Buffett's investment fundamentals have not changed.

    A lot has been made from Berkshire Hathaway's (NYSE:BRK.A) (NYSE:BRK.B) investments in IBM (NYSE:IBM) and Apple (NASDAQ:AAPL). Some people question if Warren Buffett, the man who is notorious for avoiding tech companies, has made a significant shift with these investments. First of all, it is most widely known that Berkshire Hathaway's stake in Apple had little to nothing to do with Warren Buffett at all. Nevertheless, I am going to try and explain why investing in Apple and IBM signals no change in Buffett's investment philosophy, and why it shouldn't open the floodgates for Buffett fans to start playing in the tech arena.

    http://seekingalpha.com/article/3978400-warren-buffett-care-less-tech-stocks
     
  2. Srouta Mukherjee

    Srouta Mukherjee Well-Known Member

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    I think Bholu Darth should read this it is of interest to them because of Apple.
     
  3. w4wealth

    w4wealth Well-Known Member

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    He would have invested in apple and ibm for its dividends. not for appreciation.
     
    Srouta Mukherjee likes this.
  4. Srouta Mukherjee

    Srouta Mukherjee Well-Known Member

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    Possibility is there because such stock give both benefit and so are safe for long term investment.
     
  5. w4wealth

    w4wealth Well-Known Member

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    will apple and IBM grow from here.
     
  6. Srouta Mukherjee

    Srouta Mukherjee Well-Known Member

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    Doubt is there. In 5 year IBM has given (-) 8.21 % return. In one year (-) 9.38% then how stock will change in future?

    Even Apple is now giving minus return for one year (-) 23.35%. Even in 5 year Apple has given 107.18% which is normal nothing great.

    I think Warren is having no option but for large cap stocks like that because investment size is v. large. However, normal investors should chose mid-cap and small cap blue chip stocks.

    Even Coca-Cola has given only 8.89% in 1 year and 34.1% in 5 years and 100.54% in 10 years then what is so great about it? Even FD will give such returns or even better returns.
     
    w4wealth likes this.
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