Post #15847 by rayvt on the Berkshire Hathaway board

Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A) ❤

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Apart from being so endpoint dependent, total return graphs and associated numbers are visually deceptive:
Two equities, A and B, that perform the same except that A had an early upblip, easily leads one to conclude from the charts that A consistently outperforms B because the A curve is visually obviously 'better' (i.e. consistently above) the B curve for a long time.

My preference is to graph rolling returns of A and B on the same plot, using time periods of interest for the rolling return. If 1 year, 3 year, 5 year, 10 year returns are of interest, then make four such plots.

Be sure to use the total returns which include dividends reinvested, not price-only.
Also graph using Logarithmic scale, not linear.

With Logarithmic scale, the slope is the percentage return. Whichever line is the steepest is the one with the higher return.

testfol.io shows all this. BRK-B vs. SPY https://testfol.io/?s=dcSrHsOPnC7 The slopes from 2009 are almost identical.

Then look at the "Rolling Metrics" tab. Default is 5 year (60 month) rolling CAGR. Very similar except that BRK tends to be equal or better than SPY. Except for 2025 where SPY soundly beats BRK.

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