Reflexion on Warren Buffet's Recent Gold Purchase

The Spotlight

1 minute read

Aug 26, 2020

Warren Buffett pictured against the black background as Berkshire Hathaway makes a physical gold purchase, buys shares in world’s biggest gold producer Barrick Gold.

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?


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