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Two Ways: Are Investors Still Betting on Buffett?


Strengthen your portfolio in good times and bad.


Watching Warren

Berkshire Hathaway (BRK.A, BRK.B) is set to report earnings this weekend, and CEO Warren Buffett is about to learn just how committed his investors are to his long-term view. According to the Wall Street Journal, over the last few years the company has sold long-dated put options -- basically insurance contracts -- on foreign and US equities to the tune of $4.5 billion. These options have an expiration period lasting from 15 to 20 years, and since Berkshire Hathaway has sold them, equity markets have plunged (the S&P 500 is down over 50% from its apex).

For more on the macro front, see Fil Zucchi's From Deflationary Spiral to Inflationary Spout?

From the Bull Pen: We noticed the agriculture plays trading dry yesterday. If you're in the longer-term inflationary camp, consider the Ag ETF (DBA). A sell stop can be set below $23.

From the Bear Cave
: One play in Buffett's portfolio is a real conundrum: Moody's (MCO). What exactly is the long-term value that he sees? Bears playing the downside can set a 2% buy stop above entry.

Quick Check Around the World

Asian trading closed with the Hang Seng -0.65%, Nikkei 1.48%, India -0.71%, Taiwan 0.85% and Shanghai -1.81%.

Glancing towards Europe, we see the CAC -1.66%, DAX -2.16%, FTSE -2.08%

As of 8:00 AM EST, S&P Futures are trading -10 to 741, and Nasdaq futures are -13 to 1127.

A Look At Commodities

Crude oil is trading -1.36 to 43.86. Gold is +10.4 to 953.40. Silver is +0.25 to 13.200, and copper -2.05 to 154.45.

The dollar index is +0.5150 to 88.3900.

On the Radar


08:30 GDP QoQ -5.4%
08:30 Personal Consumption
08:30 GDP Price Index 0.1%
08:30 Core PCE QoQ 0.6%
09:45 Chicago Purchasing Manager 33.3
10:00 U. of Michagen Confidence 56.2
10:00 NAPM- Milwaukee

Happy Friday! Good luck and have a great weekend!

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No positions in stocks mentioned.

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