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How old is Warren Buffett? 90? Would it make sense to bet that the value of BRK.A would drop after his passing?

TameAntelope 5y ago
That's probably priced in already.
snowwrestler 5y ago
I think so. And I find it hard to believe that is already priced in, because only Buffett fans are interested in buying BRK.A now, and fans are frequently not rational about their fandom. You don’t need to buy BRK.A to benefit from Buffett’s financial acumen. You only need to buy BRK.A if you want to say you own BRK.A. Also, the harder it is to transact a stock (and a price over $400,000 makes it hard), the less efficient price discovery is.
- kqr 5y ago
  Even if the market has underpriced Buffett's death in BRK.A, wouldn't that be compensated by the liquidity risk you're taking on with $400,000 shares?
kqr 5y ago
It will drop when that happens, but it would probably not make sense to make that bet. If you can construct a portfolio that exposes you to only that specific event (and not something like the further increases in value until that point -- seems difficult but maybe possible?) you might learn the probability of it happening at various points in time, through its price! Maybe you'll find that portfolio seriously underpriced (another comment gave some potential reasons why it would be) in which case there's money to be made.
- Denvercoder9 5y ago
  > If you can construct a portfolio that exposes you to only that specific event (and not something like the further increases in value until that point -- seems difficult but maybe possible?) You'd do that by going long in all stocks that Berkshire owns, and short Berkshire itself. The problem with that is that Berkshire also has a bunch of non-listed subsidiaries you can't buy.
myrandomcomment 5y ago
He recently publicly announced his successor. No issues. No one blinked. One of the best long term companies to own shares in. Investing to build wealth is a long game. All of my "bets" are looking out 20-30 years. Short term some years I have not out performed the market, but over the lifetime since I started I have (15 years so far..) https://www.cnbc.com/2021/05/03/who-is-greg-abel-warren-buffetts-successor-at-berkshire-hathaway.html https://www.cnbc.com/2021/05/03/who-is-greg-abel-warren-buff... There is a booked called "the millionaire next door" that is a good read.

That's probably priced in already.

I think so. And I find it hard to believe that is already priced in, because only Buffett fans are interested in buying BRK.A now, and fans are frequently not rational about their fandom. You don’t need to buy BRK.A to benefit from Buffett’s financial acumen. You only need to buy BRK.A if you want to say you own BRK.A. Also, the harder it is to transact a stock (and a price over $400,000 makes it hard), the less efficient price discovery is.

kqr 5y ago
Even if the market has underpriced Buffett's death in BRK.A, wouldn't that be compensated by the liquidity risk you're taking on with $400,000 shares?

kqr 5y ago

It will drop when that happens, but it would probably not make sense to make that bet. If you can construct a portfolio that exposes you to only that specific event (and not something like the further increases in value until that point -- seems difficult but maybe possible?) you might learn the probability of it happening at various points in time, through its price! Maybe you'll find that portfolio seriously underpriced (another comment gave some potential reasons why it would be) in which case there's money to be made.

Denvercoder9 5y ago
> If you can construct a portfolio that exposes you to only that specific event (and not something like the further increases in value until that point -- seems difficult but maybe possible?) You'd do that by going long in all stocks that Berkshire owns, and short Berkshire itself. The problem with that is that Berkshire also has a bunch of non-listed subsidiaries you can't buy.

myrandomcomment 5y ago

He recently publicly announced his successor. No issues. No one blinked. One of the best long term companies to own shares in. Investing to build wealth is a long game. All of my "bets" are looking out 20-30 years. Short term some years I have not out performed the market, but over the lifetime since I started I have (15 years so far..) https://www.cnbc.com/2021/05/03/who-is-greg-abel-warren-buffetts-successor-at-berkshire-hathaway.html https://www.cnbc.com/2021/05/03/who-is-greg-abel-warren-buff... There is a booked called "the millionaire next door" that is a good read.