Buffett's reign: Five charts that show his decades of market mastery - Nir Kaissar

Key topicsBuffett outperformed the S&P 500 over nearly 60 yearsBerkshire beat top mutual funds and indexes by a wide marginHis success came from smart stock picking, not just strategy or luck.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Nir Kaissar.Warren Buffett, the greatest investor of all time, will step down as chief executive officer of Berkshire Hathaway Inc. at the end of the year. The six-decade track record he leaves behind is so astonishing that mere numbers on a page don’t do it justice. To fully appreciate his singular achievement, it helps to see how his investing results ballooned into massive fortunes for Berkshire’s investors over time — and how much less money they would have made had they invested instead in some of the best-performing and longest-running mutual funds, or merely tracked the broad stock market. To start, here’s how Buffett stacks up against those funds. None of them even come close to the master..Buffett measures his performance against the S&P 500 Index, the ubiquitous market tracker that few stock pickers can beat. Buffett trounced it.We would normally use a standard line chart to compare a money manager’s performance with an index, but Buffett is no ordinary investor. He has outpaced the market so thoroughly and for so long that the S&P 500 disappears by comparison in a basic line chart. The same is true for indexes that mimic Buffett’s penchant for value and quality investing. .Read more:.FT: Warren Buffett bids farewell at emotional Berkshire meeting.So, we’re making an exception for an exceptional manager and charting Buffett’s performance on a logarithmic chart to better see his vast margin of victory. .Buffett won persistently. His success can’t be attributed to a few lucky breaks. More recently, though, an extended and nearly uninterrupted bull market, as well as Berkshire’s growing heft, have made it harder for Buffett to find market-beating opportunities big enough to boost Berkshire’s returns. .Buffett describes his style of stock picking as buying good companies at a fair price, essentially a blend of value and quality investing. Both strategies have beaten the market historically. Buffett has also used the leverage provided by Berkshire’s insurance business to amplify his returns. But even after accounting for those advantages using the company’s available financials back to 1987, Buffett still wins..Buffett is celebrated for his stock picking, but he is also a crafty capital allocator. He has repeatedly shown a willingness to hold cash when opportunities are scarce, and to deploy it when he sees a fat pitch, usually in a down market..© 2025 Bloomberg L.P.

Buffett's reign: Five charts that show his decades of market mastery - Nir Kaissar

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