Subject: Re: Berkshire future returns
Greg Abel’s situation has an unusual feature:

He’s still a net buyer. To your point, a big one, regularly, sure..but..

My key point Greg’s a net buyer—starting with a modest stake (roughly 18% of net worth) and steadily adding through ongoing dollar cost average like salary purchases.

Unlike Warren, who’s had all of his wealth already in Berkshire stock, Abel is in the process of building it.

That makes the sequence of returns matter.

If intrinsic value compounds steadily while the stock price lags in the early years, Abel buys more shares. More shares, bought cheaply, produce more wealth when price and value eventually converge.

If the stock moves up quickly instead this year, he simply ends up owning less of it. A very meaningful impact on his personal long term wealth

It’s just the same as young saver in a weak market: low prices early are a big advantage, not a problem.

Nothing about this changes the job. The mandate is still to grow intrinsic value per share. And there’s no practical way—or reason—to manage the stock price.

But the math is what it is:

For someone building a position, early underperformance is a feature. Very weak stock performance in year one of Greg’s fixed dollar accumulation program would be extremely advantageous to his wealth creation. The best year to have a bad year is this year.