We See Stock Market 'Anomalies,' but We Do Not Yet Understand
The observations are keener than the comprehension.
One section of Tuesday’s column, “Buffett's Betas,” didn’t make much sense.
That is, the secret sauce of Warren Buffett’s equity selection. According to an award-winning paper, “Buffett’s Alpha,” the Oracle of Omaha plays it safe. Berkshire Hathaway’s (BRK.A) companies—both publicly traded and private—have been of high quality. They have been steadily, consistently profitable, with high cash flows and low debt. Consequently, their stocks’ prices have been relatively stable.
John Rekenthaler does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.