64% of Warren Buffett’s $371 Billion Portfolio Is Invested in Just 3 Stocks

For almost 60 years, the Oracle of Omaha has been dazzling Wall Street. I’m talking about Berkshire Hathaway‘s (NYSE: BRK.A)(NYSE: BRK.B) CEO Warren Buffett. Since taking over as CEO in the mid-1960s, he has overseen a greater than 4,760,000% gain in his company’s Class A shares (BRK.A). A seven-digit return is certainly going to get a money manager noticed — and for good reason.

What makes Warren Buffett such a hero for everyday investors is his willingness to share his insights on the U.S. economy and investing. Lengthy books have been written that discuss some of his favorite investing philosophies, such as buying stakes in brand-name businesses with sustainable moats and holding these positions for lengthy periods.

Berkshire Hathaway CEO Warren Buffett. Image source: The Motley Fool.

However, the factor that isn’t given nearly enough credit for Berkshire Hathaway’s long-term success is portfolio concentration. Warren Buffett and his top investing aides, Todd Combs and Ted Weschler, strongly believe in putting the lion’s share of Berkshire’s capital to work in their top ideas. And if these top ideas generate sizable returns, Berkshire Hathaway’s stock is likely headed even higher.

Despite Berkshire having stakes in 49 stocks, as of Sept. 30, 2023, 64% of the invested assets ($236.1 billion) Warren Buffett oversees in Berkshire Hathaway’s $371 billion portfolio are being put to work in just three brand-name companies.

Apple: $170.2 billion (45.9% of invested assets)

Any question of whether or not the Oracle of Omaha and his team favor portfolio concentration is made crystal clear by tech stock Apple (NASDAQ: AAPL), which accounts for nearly 46% of Berkshire’s invested assets. This Apple stake amounts to 20% of Berkshire Hathaway’s market cap, which means the health of Apple and its stock very much matters to Berkshire Hathaway’s investors.

The three factors that are likely most responsible for luring Warren Buffett, Todd Combs, and Ted Weschler into such an outsized position in Apple are its brand, its ongoing innovation, and its market-leading capital-return program.

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