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Commentary

A Birthday Gift Buffett Would Truly Appreciate

These stocks might be too small for Warren Buffett, but individual investors may want to give them a look.

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What do you get an octogenarian billionaire investor for his birthday? That's a question that Warren Buffett's friends and family are asking themselves today. We humbly submit that the best gift may be a smaller pool of assets to invest. 

Buffett himself has said many times that the biggest challenge he faces in keeping up his remarkable track record is deploying his massive and growing amount of capital. It's not that the Oracle of Omaha has suddenly lost his confidence in picking stocks or making other investments. There just aren't very many attractively priced deals or stocks out there that are large or liquid enough to move the needle. The only way to really make a difference is with megadeals, such as the purchase of Burlington Northern Santa Fe, that are both sizable and have the ability to soak up the huge amounts of cash that Berkshire throws off. Such transactions just don't come along that often. 

Jeremy Glaser does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.