FRI, DEC 13, 2024

WARREN BUFFETT WATCH

High-risk single-stock Berkshire ETFs begin trading

Two new ETFs linked to Berkshire Hathaway's Class B shares started trading this week, but they definitely don't reflect Warren Buffett's buy-and-hold philosophy.

Direxion launched what it is calling "the first leveraged and inverse single stock funds on Berkshire Hathaway, allowing traders to react to Warren Buffet[t]’s guidance and sentiments."

The Direxion Daily BRKB Bull 2X Shares, ticker symbol BRKU, is designed to double the daily moves of the B shares.

The Direxion Daily BRKB Bear 1X Shares, ticker symbol BRKD, is crafted to move in the opposite direction of BRK.B's daily performance, but with no amplification.

Direxion, which already had 11 pairs of similar single-stock leveraged and inverse ETFs, stresses in its Education Center they are short-term instruments meant to be used by sophisticated, active traders with a very high tolerance for risk.

(Bloomberg's Matt Levine offers an extensive explainer of the risks of leveraged ETFs in his excellent Money Stuff column.)

This week, Direxion also launched leveraged and inverse ETFs tied to Palantir Technologies, a high-flying tech stock that is up 333% year-to-date.

Strategas ETF analyst Todd Sohn tells Reuters it's an odd pairing.

"Palantir is very, very actively traded, and very, very volatile, so that's going to appeal to the people who trade these leveraged ETFs. Berkshire Hathaway, while it's large and has done better than the market, just doesn't offer that extra excitement."

Chartist: Berkshire stock decline is 'buyable dip'

Technical analyst Carter Worth writes on CNBC Pro today he thinks Berkshire Hathaway Class B shares are set to bounce higher after dropping almost 7% from their 52-week intraday high of $491.67 on November 27.

He notes Berkshire has "experienced five similar selloffs year to date... and has rebounded in short order each and every time."

The current decline, he argues, puts "the stock at a level of support where rebound potential is judged to be high."

Buffett is #8 on Billboard chart

Warren Buffett ranked #8 on Billboard's "Top 10 Billionaire Backers of Music Companies," released yesterday.

It cites Berkshire's 33% stake in Sirius XM Holdings, although the satellite radio company is generally thought to be portfolio manager Todd Weschler's jam.

The stock is down almost 15% this week after its 2025 revenue forecast, released Tuesday morning, came in below Wall Street's expectations.

BUFFETT AROUND THE INTERNET

Some links may require a subscription

CNBC Pro (subscription): What Warren Buffett said about Trump’s first trade war, as tariff threats fuel fears of another battle

Wall Street Journal (subscription): What You Can Learn from Young Warren Buffett

HIGHLIGHTS FROM THE ARCHIVE

'This is Berkshire’s competitive edge' (2013)

Warren Buffett and Charlie Munger explain how Berkshire differs from other companies, especially in the way managers of subsidiaries are left alone.

BERKSHIRE STOCK WATCH

Four weeks

Twelve months

BERKSHIRE'S TOP U.S. STOCK HOLDINGS - Dec. 13, 2024

Berkshire's top holdings of disclosed publicly traded stocks in the U.S., Japan, and Hong Kong, by market value, based on today's closing prices.

Holdings are as of September 30, 2024 as reported in Berkshire Hathaway's 13F filing on August 14, 2024, except for:

Bank of America, which is as of October 15, 2024
Mitsubishi, which is as of June 12, 2023. Tokyo Stock Exchange prices are converted to U.S. dollars from Japanese yen.

The full list of holdings and current market values is available from CNBC.com's Berkshire Hathaway Portfolio Tracker.

QUESTIONS OR COMMENTS

Please send any questions or comments about the newsletter to me at alex.crippen@nbcuni.com. (Sorry, but we don't forward questions or comments to Buffett himself.)

If you aren't already subscribed to this newsletter, you can sign up here.

Also, Buffett's annual letters to shareholders are highly recommended reading. There are collected here on Berkshire's website.

-- Alex Crippen, Editor, Warren Buffett Watch

900 Sylvan Avenue, Englewood Cliffs, NJ 07632

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