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A Look at Berkshire Hathaway’s Annual Market Returns From 1968 – 2007

By JLP | April 2, 2008

This is pretty incredible to think about. Below is a year-by-year listing of Berkshire Hathaway’s year-end closing prices for their Class A stock.

Berkshire Hathaway's Market Returns 1967 - 2007

It’s pretty incredible to think that a $20.50 investment at the end of 1967 would have been worth $141,600 at the end of 2007. That’s an average annual rate of return of 24.73% over each of those forty years! Had you purchased just 100 shares (a $2,050 investment + brokerage fees) of Berkshire at the end of 1967, you would have had over $14.1 MILLION at the end of 2007. That’s a pretty nice retirement!

Sadly, those returns are history now. Recent history (the last 5 years in particular) shows that the returns, although not bad, were nothing like the returns of the past. Here’s a look at how Berkshire performed over the last 5, 10, 15, and 20 years:

Berkshire Hathaway's Average Annual Returns

I think it’s evident that Buffett is having a harder time finding places to put Berkshire’s money. I wouldn’t expect 24% annual rates of return in the future.

Related:

Berkshire Hathaway 2007 Annual Report (PDF)

Warren Buffett’s 2007 Letter to Shareholders (PDF)

Topics: Investing | 4 Comments »


4 Responses to “A Look at Berkshire Hathaway’s Annual Market Returns From 1968 – 2007”

  1. Ron@TheWisdomJournal Says:
    April 2nd, 2008 at 7:52 pm

    Wow….just….wow.
    If my calculations are right, a $1,000 investment in 1967 would be worth almost $7 million today.
    And people “can’t be bothered” with learning to invest on their own.
    Bear in mind that when Buffet started out, financial information wasn’t as easily discovered as today. It took work and lots of it.

    Still saying, “Wow.”

  2. Christopher Smith Says:
    April 3rd, 2008 at 1:43 am

    Early on, Buffett also had the insight to buy up insurance companies and make solid investments on their float–leverage without debt. However, that’s probably a one-time coup, and that’s part of why the returns have been slowing down (to 50% above market returns, of course).

  3. Carmen Says:
    November 15th, 2008 at 12:58 am

    I think that we are in a similar or almost similar market condition as 73-74 era when he purchased many undervalued stocks, we can all buy right now and expect to have those types of returns in the next few years.

    Jump in! The water is chilly but if you are brave it will soon be refreshing….Ahhh

  4. Carmen Says:
    November 15th, 2008 at 1:02 am

    Correction:
    We can all buy right now [good, quality] stocks and ….blah blah blah

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