No. of Recommendations: 0
It's tempting, but would it work? e.g., deploying half the capital with a shotgun approach in "reasonably good" firms, merely skipping those in industries with obvious problems for long term profitability prospects. Mathematically, merely avoiding some fraction of really big losers can give you a meaningful edge. The other half would still be handy when an elephant comes along. Berkshire needs a 40 foot tall elephant at this point, and those are scarce, so maybe head office need only be prepared for 20 foot ones?
The question is whether that would be more or less good for value per share compared to paying a relatively rich price for share buybacks. Do shareholders really want to own more of BHE? Tough questions.
Makes sense, but sure, understand the concerns. With Buffett gone, does Berkshire have the skill set to actively invest $100s of billions in a concentrated portfolio of equities? I guess Buffett thinks they do?
