On a CAGR basis that 5.5M percent works out to roughly 19.9% annualized over 60 years. The compounding math is what really stuns, not the headline number.
Worth flagging: SPXTR is the right benchmark since BRK pays no dividend. From 2000, BRK compounded at ~10.4% vs SPXTR ~8.5%, about 1.8%/yr of alpha over 26 years. Much smaller than the price-only chart implies. And from 2006 the alpha is gone: 20 years! of BRK roughly matching the S&P total return, with the index slightly ahead now. How matching the index for 20 years considered great?
That 5.5 million percent return is roughly a 19.7 percent CAGR since 1965. NDX has compounded near 12 percent and SPX near 10 percent over the same window. What separates BRK is holding cash through cycles and still compounding on a higher long term Sharpe.
On a CAGR basis that 5.5M percent works out to roughly 19.9% annualized over 60 years. The compounding math is what really stuns, not the headline number.
Worth flagging: SPXTR is the right benchmark since BRK pays no dividend. From 2000, BRK compounded at ~10.4% vs SPXTR ~8.5%, about 1.8%/yr of alpha over 26 years. Much smaller than the price-only chart implies. And from 2006 the alpha is gone: 20 years! of BRK roughly matching the S&P total return, with the index slightly ahead now. How matching the index for 20 years considered great?
That 5.5 million percent return is roughly a 19.7 percent CAGR since 1965. NDX has compounded near 12 percent and SPX near 10 percent over the same window. What separates BRK is holding cash through cycles and still compounding on a higher long term Sharpe.