Warren Buffett: I've made bigger mistakes than not investing in Amazon
Berkshire Hathaway (BRK-A, BRK-B), the giant holding company run by famed investor Warren Buffett, has finally invested in Amazon (AMZN).
The news comes after years of Buffett acknowledging that missing Amazon was a mistake.
"Yeah, I've been a fan, and I've been an idiot for not buying," Buffett told CNBC’s Becky Quick. He further noted that the decision to buy was not made by him, but one of his investment managers, Todd Combs or Ted Weschler.
Amazon was “outside my circle of competence”
Buffett says he's made bigger mistakes than missing out on investing in Amazon.
"I always admired Jeff [Bezos]. I met him 20 years ago or so. And I thought he was something special, but I didn't realize you could go from books to what's happened there," Buffett told Yahoo Finance's editor-in-chief, Andy Serwer, in a wide-ranging interview. "He had a vision and executed it in an incredible way.”
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He added that there’s “a lot of gains” that he’s “missed.”
“I don't worry about the things that I miss, that are outside my circle of competence of evaluating,” Buffett said. “I have missed things [which] are within my circle, and that's a terrible mistake. Those are my biggest mistakes. You haven't seen them.”
Buffett, 88, has historically shied away from investing in tech stocks because they were out of his circle of competence.
In recent years, though, he's moved into a notable tech name, with Apple (AAPL) now being the largest equity holding for Berkshire Hathaway. However, Buffett has hinted that his younger investment deputies — Weschler and Combs — were responsible for buying Apple.
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At its 2017 annual meeting, Berkshire Hathaway’s vice chairman and Buffett’s right-hand man Charlie Munger explained that they avoided tech stocks in the past because they felt they had “no advantage where other people did.”
“I think that’s a good idea to not play where the other people are better,” Munger said. He added that he thought they were “probably smart enough” to figure out Google (GOOG, GOOGL), though.
“I would say that we failed you there,” Munger said at the time. “We were smart enough to do it.”
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At that same meeting, Munger said the pair also blew it on Walmart by not investing earlier.
“It was a total cinch. We were smart enough to figure that.”
Berkshire didn’t invest in Walmart (WMT) until the second quarter of 2005. They have exited the position entirely in recent years.
More recently, Buffett told Serwer in 2018 that he made a "mistake" by not investing in JPMorgan Chase (JPM). A long-time fan of JPMorgan CEO Jamie Dimon, Buffett's Berkshire corrected that “mistake” by investing in the bank’s stock during the third quarter of 2018. JPMorgan is now the 8th largest stock holding in the portfolio.
NOTE: A version of this story was first published on May 1, 2019.
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Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter.
