In this video I want to go over the reasons why Warren Buffett has not bought any stocks in 2020 and is in fact net selling! 📊 Sven Carlin (Expert Investor) Portfolio & Free Investing Course:
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When it comes to looking at the stock market or the economy, one of the go to guys that all of us investors look at, is Warren Buffett. He owns the worlds biggest investing firm Berkshire Hathaway and he’s outperformed the stock market by a long way.
Now, recently he held his annual shareholder meeting, where he gives his thoughts on the stock market, the economy and on the stocks that he’s buying and selling. But the unique thing about this shareholder meeting, was that Warren Buffett revealed that he has not bought any stocks in 2020. In-fact Berkshire Hathaway his investing firm has been a net seller of stocks.
Obviously one of those big group of stocks that Buffett sold was all of his airline companies. Delta, American Airlines, Southwest and United Airlines. Entirely sold. Which clearly came as big surprise to most investors.
But, what I want to talk about in this video, is first I want to go through the stocks that he’s selling at Berkshire Hathaway. But more importantly I want go over the underlying reasons why Buffett has not bought any stocks and in fact is a net seller. Very important video this one…
So let’s start by showing you Warren Buffetts biggest stock sale obviously apart from his airline stocks. And I’m surprised no ones really talking about this… He’s sold off most of his position in the bank Goldman Sachs. He previously owned 12 million shares in the company and he sold over 10 million of those shares. That’s 84% of his holdings…
Buffett said that if economic difficulties become severe enough "even strong banks can be under a lot of stress, and we'll be very glad we've got the Federal Reserve system, standing behind them."
So I don’t know exactly how to read into this, but let’s just say I personally would not want to be a Goldman Sachs shareholder at this point in time.
But Goldman was not the only bank sold, also 3% of Berkshires JP morgan was let go as well. Now this is nowhere near close to the 84% sale in Goldman sachs, but still it’s something to think about.
Another stock on the sale list was Sirius Xm the broadcasting company. Berkshire sold almost $4 million shares in them.
Other big names on the selling list for Berkshire were Amazon the e-commerce company. General Motors the vehicle company and Philips 66 the energy company was 100% sold as well.
And yes, there were more companies sold by Berkshire Hathaway but we don’t have the time to go over them all. The big question on everyone’s lips however, is why? Why has Buffett sold so many stocks and purchased nothing?
There’s a couple of fundamental reasons and I want to get into them now…
The first thing you need realise is it’s not like Warren Buffett doesn’t have any cash so that he cannot buy any stocks. No. He’s actually got $137 billion dollars of cash on the side-line, waiting to be deployed.
And Buffett said himself he wants to deploy quite a bit of this. He said and I quote ““We are willing to do something very big. I mean you could come to me on Monday morning with something that involved $30, or $40 billion or $50 billion. And if we really like what we are seeing, we would do it,”. But at the moment, “we haven’t seen anything that attractive.”
And that’s the first key reason why Buffet is not buying any stocks. Because he can’t find anything attractive to buy, at the current stock prices.
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DISCLAIMER: It's important to note that I am not a financial adviser and you should do your own research when picking stocks to invest in. These are just some of my viewpoints, by no means would I recommend watching one YouTube video and then immediately buying that stock. This video was made for educational and entertainment purposes only. Consult your financial adviser.
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