How Would You Invest $150 Billion?
Warren Buffett and his company - Berkshire Hathaway - are sitting on ~$150 Billion in cash. It's an incredibly large amount of dry powder to have as your bankroll but that's the net result of playing a long-game, buying great companies and focusing on assets that generate cash flow.
In 2022, Berkshire Hathaway made $234.19 Billion. Their projected revenue this year is $285.50B.
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Right now, they are sitting on $150B and looking for an acquisition to deploy that capital. Buffett has said in the previous few shareholder meetings that it has been hard to find the right targets for acquisition.
He typically looks for:
- simple businesses
- businesses with a moat (or competitive advantage)
- long-standing businesses with good track records
- cash-generating businesses
- businesses with great management
Finding businesses that are large enough at scale and also have these qualities who are ALSO willing to sell is very difficult. Hence, Buffett's cash stockpile keeps on growing.
He sometimes does Berkshire stock repurchases "when they feel the stock is undervalued". In Q1 of this year, they bought back roughly $4.4B worth of stock.
How Would You Invest $150 Billion?
This is a pretty wild idea but can be a fun thought exercise. It's harder to invest $150B than you might think.
You can't just go out and buy some stocks. To buy at that scale (and in the public eye), you'd be running up the share prices as you try to accumulate.
You can slowly accumulate shares in stocks, bonds and other highly liquid investments, but that is still a ridiculous amount of dry powder to deploy.
A lot of us would probably say to buy BTC or HIVE with that cash. Problem is that in the case of BTC, you'd run the price up to oblivion. I mean, imagine the headline "Warren Buffett aims to deploy $150B into Bitcoin".
We'd be at $500k BTC overnight.
How Would You Invest $1 Million?
Now here is a bit more practical of a question. You can start with the first thought exercise and it will likely tell you about some sectors/industries you are interested in.
$1M will tell you more about the individual investments that you'd be interested in making.
Personally, I would deploy this into a few different places to generate a reliable, but growth-oriented return.
I would:
- Invest in some sort of cash-equivalent asset that pays a dividend (HBD has been my latest avenue for this, earning 20% APR)
- I would take another % and deploy it into Bitcoin. This would make up the most signifcant portion of the portfolio next to the HBD
- A third % would be deployed to a subset of smaller altcoins in the crypto industry. It's an industry I know well so LEO, HIVE, RUNE, ETH, etc. would make the top of my list here
- I would look for some kind of non-crypto investment. A hedge against the industry. Likely a small real-estate investment
This breakdown would give me some steady income (from #1), it would also give my hyper-growth from #2 and #3. Then it would give me an industry hedge with #4.
In fact, my real portfolio actually looks a lot like this breakdown. I have been simplifying things and moving them more in a direction like this.
Leave a Comment Below
I'm really curious to see how you would construct your portfolio. If you already constructed your portfolio, feel free to share as many or as few details below as you want.
Like I said, I've been giving a lot more thought to portfolio construction lately as I have been getting a lot of life / business finances in order.
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In Real Estate and then NOT rip people the fuck off as the economy does right now x)
In my case i invest in hbd a 50% of the portfolio AND BTC the rest 48%
AND the last one 2%
I took the @kevinwong token of tau.net agrs AND put in it.
Did you Review taunet
Told me, if you do not i invites you View.
Well this Is my simple portfolio managment as am strategic allocation.
Best regard.
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If I am to invest $1 million, I'll make sure 50% of the money goes into BTC, and the remaining 50% I will use it to buy hive, hbd and eth.
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If i had a million to invest. I would be looking at diversifying between liquid assets like stocks and cryptocurrencies. Heavily i would be investing in passive income generating assets like etfs, dividend stocks, index funds. Then add a mix of illiquid assets like rental properties. I will also be using a small portion to start a small business.
The advances that are being proposed to grow Hive at a faster rate are certainly astounding. I expect all of this lite accounts thing to have a long-term positive effect on the growth of Hive and Leo. About Buffett's case, I can't even imagine how he think financially, he is a genius, but it would surely be a fun and productive exercise.
That's exactly what I would do. 100% aligned.
My sister talked me through investing in land properties but because I don´t have the money, this will be an opportunity for me. I will use some percent to invest in lands. Buy lots of Hive and power up. Make use of the 20% APR in HBD to keep getting interest. Invest in altcoins like LEO, LGN, BRO, ETH.