On June 1, Berkshire Hathaway agreed to buy five billion dollars of Alphabet's Class A shares at $351.81 each.
But last Friday, Alphabet closed at $345.90.
So you can now buy the exact same shares, in the same company, for about $6 less than Berkshire paid.
And it will make almost no difference to your returns, because the shares were never the point.
Here's what Berkshire actually bought…
Roughly 60% of the 48.1 million Alphabet shares Berkshire added last quarter never touched the open market.
They came directly from Alphabet in what's called a private placement. This is where a company issues brand new shares and sells them straight to one buyer at a price agreed in advance.
So no order book… no other bidders - and certainly no chance of the price running away while the buying happens.
Alphabet was raising $84.75 billion to build AI data centres. Berkshire took $10B, split evenly between Class A at $351.81 and Class C at $348.20.
All this off the back of a phone call…
And it made that call to Berkshire because in March, Berkshire was sitting on $397.4 billion in cash and Treasury bills… meaning it can commit $10B without selling a single existing holding
That is the true asset you’re getting with Berkshire right now…
Your broker cannot get you into that private placement. Neither can mine, and neither can the $50 million family office down the road from me.
And because of the delay in Berkshire revealing their holdings… you’ve got now chance of copying their trades even if you wanted to.
Plus there’s the part which investors outlook…
Alphabet is 10.2% of Berkshire's listed stock portfolio.
But Berkshire is not just it’s public stock portfolio…
Berkshire is a railroad… a utility empire… GEICO, a truck stop chain… a food distributor, a newly acquired homebuilder, on top of $365.5 billion of cash.
Against a market value of roughly $1.1 trillion, that $36.6 billion Alphabet stake is somewhere around 3c on the dollar.
Meaning that an investor who reads "third largest holding, 10% of the portfolio" and puts 10% of a $300,000 account into Google is running roughly three times the concentration Buffett and Abel signed off on.
Same ticker… and in this instance even cheaper entry. But you’ve now got 3x the concentration. That is what copy-trading a 13F actually produces.
If what you want is Berkshire's judgement applied to Berkshire's money, there is a ticker for that - BRK.B
Ivy has started lifting my coffee cup to her mouth with great seriousness, then looking betrayed when nothing comes out. Copying the visible action yet missing the mechanism is a very human instinct… most of us just get better at hiding it.
Oliver