Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money

79% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

FREE EBOOK

How to Day Trade Stocks & Indices

  • Place your first trade
  • Identify 9 chart patterns
  • Pro strategies step-by-step

You'll also receive our newsletter and other Opto emails in accordance with our privacy policy. This form is protected by reCaptcha

Don't miss out

Get our FREE Day Trading guide

+ Pro-trader interviews

You'll also receive our newsletter and other Opto emails in accordance with our privacy policy.

FREE Trading guide

Including Day trading strategy examples

+ Pro-trader interviews

You'll also receive our newsletter and other Opto emails in accordance with our privacy policy.

Market Outlook

Warren Buffett’s 5 Largest Holdings As Of August 2020

When Warren Buffett speaks, investors listen. The 89-year-old guru has lived by a few important investment tenets which include investing in businesses with strong economic moats, transparent and accountable management, and companies that pay dividends. His company, Berkshire Hathaway (NYSE: BRK-A) is valued at nearly half a trillion dollars and has seen revenue growth of over 87% in the last decade. Here, we include the top five holdings in the Berkshire portfolio.

This article was originally published on MyWallSt Investing for Everyone.

 

Company% of Berkshire’s Portfolio
Apple44.18
Bank of America10.85
Coca-Cola8.83
American Express7.13
Kraft Heniz5.13

 

1. Apple

Buffett has always been a fan of his $20 flip phone; that is, until February of this year, when he chose to invest in an Apple (NASDAQ: AAPL) iPhone. He also brought his total ownership in the company to approximately 5.5%. Buffett, never a fan of tech companies, was introduced to Apple by one of his portfolio managers in 2016 and found value in the company after seeing his great-grandchildren’s fidelity to the brand. Good thing too, as Apple’s growth and resilience to the pandemic has been notable.

The first $2 trillion organization in the U.S. has had incredible sales of not only its insanely popular iPhone and iPad products, but also of its wearables like the Apple Watch and AirPods. Here’s a breakdown of its global market share:

 

ProductiPhoneiPadApple WatchAirPods
Global Market Share(%)14.658.485541

 

Apple’s revenue has grown nearly 300% in the last decade and it offers a quarterly dividend of $0.82. As of August 21, its stock price is $491 and will be splitting 4-to-1 on August 31. 

 

2. Bank of America 

In the last few months, Berkshire Hathaway has added to its Bank of America (NYSE: BAC) holdings by purchasing $1.7 billion worth of the company’s stock to have an approximately 11.8% ownership of the bank. A strange move considering that banks are facing some serious headwinds thanks to the pandemic, but the stock price is considered cheap considering the quality of the company. Bank of America has a Common Equity Tier 1 (CET1)  ratio of 11.6%, 2.1% over what it should have. This number is used to measure a bank’s capital strength and even if the company covered all of its losses in its loan book (roughly 4.7%), it would still be at 10.25%. Additionally, the stock is trading at $24.90 on August 21, less than ten times earnings.

 

3. Coca-Cola 

Buffett is rumored to consume no less than five cans of Coca-Cola (NYSE: KO) every day; he has been a fan of the product since selling bottles for a profit at six years of age. As Berkshire’s longest-held and never sold equity, the company’s stock price has surged 1750% since 1988, the year Buffett first took a position. It holds approximately a 9.31% stake in the beverage company and has received nearly $7 billion in dividends alone since 1995. Buffett understands that the company is facing obstacles in a more health-conscious market but feels that Coca-Cola has the world’s best distribution system and that should serve it well as it expands to other products like energy drinks and alcoholic beverages.

 

4. American Express 

Buffett first invested in American Express (NYSE: AXP) in 1964 following a scandal involving vegetable oil futures that drove its stock price down. Buffett understood that the company’s brand encouraged loyalty and a sense of belonging to a special club and has over time acquired nearly 19% of AMEX. It was a great investment since AMEX’s stock price began to grow once the scandal subsided and will grow even more as the company is the first foreign credit card company to be allowed to operate in China starting this year, the world’s highest populated country with a multi-trillion dollar market; in fact, China’s mobile transactions alone exceeded $27 trillion in 2018. The company has had steady revenue growth of nearly 57% in the last decade and offers a quarterly dividend of $0.43. 

 

 

5. Kraft Heinz 

With nearly a 27% stake in Kraft Heinz (NASDAQ: KHC), Berkshire Hathaway is the company’s biggest shareholder. This is problematic as the company hasn’t been doing well lately and Buffett regretted purchasing shares of the company but will find it difficult to unload with such a huge position. Although the company got a boost from the pandemic, long-term outlook doesn’t look good as people are shifting from pre-packaged foods and shelf staples for healthier options. Fortunately, it’s the only company along with Apple in Buffett’s top five that has seen a nice YTD gain this year of over 16%.

 

MyWallSt makes it easy for you to pick winning stocks. 

Start your free trial today — it's the best investment you'll ever make.

MyWallSt is a maker of financial investment tools designed to transform anyone into an informed, confident investor. With our award-winning apps and investing services, we'll show you how to get started and beat the market. 

Learn more here.

Disclaimer Past performance is not a reliable indicator of future results.

CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.

CMC Markets does not endorse or offer opinion on the trading strategies used by the author. Their trading strategies do not guarantee any return and CMC Markets shall not be held responsible for any loss that you may incur, either directly or indirectly, arising from any investment based on any information contained herein.

*Tax treatment depends on individual circumstances and can change or may differ in a jurisdiction other than the UK.

Continue reading for FREE

Join the 40,000+ subscribers getting market-moving news every week.

Written by

Free ebook

Tricks of the trade: 7 interviews with the world’s top traders

Get it now

Related articles

7 Interviews with the world's best traders

Learn about the techniques and strategies used by expert traders

Get it now