Rejecting traditional asset allocation strategies · Transcript · BuffettMungerGPT

WarrenWell, if you look at Berkshire, you will find that it really doesn't do much of conventional asset allocation to categories. We are looking for opportunities, and we don't much care what category they're in. And we certainly don't want to have our search for opportunities governed by some predetermined artificial bunch of categories. In this sense, we're totally out of step with modern investment management, but we think they're wrong. But when have you done a big asset allocation strategy? Never. Yeah. We end up with peculiar asset mixes. I mean, if the junk bond thing had gone on a little longer instead of having $7 billion in there, we might have had $30 billion in. But we were doing that simply based on the fact that it was screaming at us. And we do the same thing with equities. I mean, back for many years, we had more than the net worth of Berkshire in equity positions. But they were cheap. And I want you to remember one of my favorite sayings as you do this acid allocation. If a thing's not worth doing at all, it's not worth doing well. You can see why Ben Franklin turned the mantle over to Charlie.