Editor’s note: This article was first published in August 2014. The market data is from then: Berkshire Hathaway Class A shares at a record of about $200,000, a rise of more than 100% since 2006, and “today” meaning 2014 for the roughly €10 million result.
Shares in Warren Buffett‘s company, Berkshire Hathaway, have just hit an all-time high. Right now they are trading at around $200,000 per share.
Let’s imagine that in 1964 your father had decided to trust his money to the young Warren Buffett by buying shares in his company (a textile company at the time). In other words, buying €1,000 worth of Berkshire Hathaway shares.
In 1964 Berkshire shares were trading at $19, and they have risen gradually and steadily ever since. Their growth was certainly stronger in the early years than in the last decade, although since 2006 the shares have still gained more than 100%.
Financial journalist Elena Holodny put together a table for Business Insider, so the example is in dollars, but we only need to swap dollars for euros to find that the result is exactly the same.
If we had bought €1,000 of Berkshire shares in 1964, today we would have roughly €10 million, and that only counts the share price, without including dividends or reinvested dividends. In that case we would probably be talking about some €15 million, and probably more.
The Business Insider chart shows how much money we would have depending on the year in which we invested that €1,000, and even buying shares as late as 1978 would have made us millionaires. Once again we can see that by investing in a solid, steadily growing company with a good manager, and with patience, our investment ends up being very profitable in the long run.
Read: 19 investing secrets everyone should know before investing
Featured image: Marcbela, Public domain, via Wikimedia Commons.
