Warren Buffett Return on Equity

The Warren Buffett return on equity is not the highest in terms of percentage gains every year, but in terms of market wizards who can outperform the S&P 500 consistently over the past 40 years, Warren’s strategy certainly holds the test of time. With large amounts of capital, the gains are still great at an average of 19.1% gains every year. some years, the yearly annual gains of Berkshire Hathaway reach up to 40% gains from the previous year. This differs greatly from the regular index ETFs like the SPX or the Dow Jones. In contrast, Warren Buffett and Berkshire Hathaway have a different approach. What Warren and Charlie Munger like to do is buy companies that they are familiar with that are available on the Open Market at a discount. They will then by upwards of 25% of the company and then hold for an extended period of time until profits have been reached. It is very simple investing strategy and in terms of the sheer volume and size of the trade positions that are put on, the strategy works beautifully. For example, the types of stocks that Warren Buffett and Charlie Munger of Berkshire Hathaway will invest include Phillips 66, Wells Fargo, including U.S. Bancorp, Southwest Airlines, Delta Airlines, Goldman Sachs, Apple, and a few others. Since the inception of Berkshire Hathaway fifty years ago, the company has grown over a million percent in returns on the markets, compounded. More information on the Warren Buffett return on equity can be found in his yearly letter to investors located at www.berkshirehathaway.com/letters.

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