Reflexion on Warren Buffet's Recent Gold Purchase
Anti-gold Oracle of Omaha catches the investment world off guard by finally showing interest in the yellow metal and buying $563.6 million worth of shares in Barrick Gold.
Last quarter, Berkshire Hathaway bought for $563.6 million of shares in Barrick Gold, one of the world's biggest gold miner.
The news quickly hit the investment world like an earthquake: Warren Buffet, the famously anti-gold Oracle of Omaha, was showing an interest in the gold industry.
It was a true u-turn for Mr. Buffet, whose disdain for the yellow metal was well-known, even calling it a "useless cube".
Even if this still represents a small position for the multi-billion dollar fund, it was evident that this was the sign of a shift in Mr. Buffet's mind.
Indeed, in addition to the purchase of this gold-producing asset, Berkshire Hathaway had also acquired a gas pipeline network for $9.7 billion earlier this year.
On the other end, Buffet's team has also been selling part of its holdings in the financial sector:
- Berkshire Sold 100% of its stake in Goldman Sachs.
- Berkshire Sold 25% of its stake in Wells Fargo.
- Berkshire sold 60% of its stake in JPMorgan.
In conclusion, it seems that Warren Buffet's Berkshire Hathaway has been moving away from financial institutions and is starting to build a position in commodity-related assets, including gold.
It will be interesting to follow his next move.
Would you like to follow Warren Buffet’s example?