| | | Hello. | Warren Buffett officially retired as CEO of Berkshire Hathaway in January 2026. He's 95 years old and still chairman. The handoff to Greg Abel is the closest thing the investing world has to a generational changing of the guard. | It's also a good moment to revisit one of the most striking statistics in modern investing: more than 99% of Warren Buffett's net worth was earned after he turned 50. | That’s the kind of stat that, once you actually sit with it, changes how you think about your own portfolio. Buffett wasn't a worse investor at age 30 than he was at 50. He just hadn't had time yet for compounding to do what compounding does. | Today's edition is a tour through how that compounding actually played out: the philosophy, the famous bets, and a few lesser-known ones that did much of the work behind the scenes. | This is not financial advice. Always do your own research. Past performance doesn't guarantee future results. |
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| | The Math of Compounding (Buffett Edition) | By his 40s (in the 1970s), Buffett's net worth was around $100 million. At 95, it's around $149 billion. That's roughly a 1,500x gain over ~50 years. | Berkshire Hathaway has compounded at roughly 19.9% per year since 1965 versus about 10.4% for the S&P 500 over the same window. The percentage-point difference looks small. Over six decades, it produced one of the largest fortunes in history. | This is a textbook case: in any compounding curve, the real wealth lives at the back end. | $1 invested at 10% per year for 30 years grows to about $17.45. The first decade gets you to roughly $2.59. The last decade alone takes you from $6.73 to $17.45. The final stretch of compounding produces most of the gain. | | Buffett's career is the most extreme version of that math any living person has experienced. His skill is investing. His secret is time. |
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| | The Philosophy (in Plain English) | Buffett's approach to investing is famous for being simple, but most individual investors still don't actually do it. The shortest version: | Buy great businesses, not great stories. A company with a real moat (brand, network effect, scale advantage, or switching costs) can compound for decades. A hot stock can compound for a few quarters. Hold forever, or close to it. Buffett has held Coca-Cola untouched since 1994. American Express since the 1960s. Selling great businesses too early is usually the most expensive mistake a long-term investor can make. The price you pay matters more than people admit. Buffett doesn't chase the most exciting company in the market. He waits until a great business is on sale and then buys aggressively.
| | Cash is patience. Berkshire ended 2025 with $373 billion in cash and Treasuries. Buffett has been criticized for years for holding too much. He has also never run out of dry powder when he needed it. |
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| | The Famous Win: Coca-Cola | In 1988, Buffett started buying Coca-Cola during what was then an unloved stretch for the stock. By 1994, Berkshire owned 400 million shares at a total cost basis of roughly $1.3 billion. | The position has been untouched since. Today, those 400 million shares are worth around $31 billion. Coca-Cola is also paying Berkshire roughly $848 million a year in dividends after the February 2026 dividend hike, which works out to a roughly 65% annual yield on Buffett's original cost basis. (Coca-Cola is now on a 64-consecutive-year dividend-increase streak.) | The lesson: A boring company, bought at a reasonable price, and held for three decades produced a roughly 25x return on the stock alone, plus enough cumulative dividends to repay the original investment many times over. |
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| | The Modern Win: Apple | Apple is the more recent and more controversial example. Buffett started buying it in early 2016, after years of publicly saying he didn't understand tech. He came around because he saw Apple wasn't really a “tech company.” It was a consumer brand whose ecosystem locked people in so well that they happily bought a new iPhone every few years. | By 2023, Berkshire owned roughly 905 million Apple shares worth around $156 billion, making Apple a large equity position in his portfolio. | Buffett then trimmed sharply in 2024 and 2025, though Berkshire's most recent disclosure shows about 228 million shares remaining, worth roughly $62 billion. Apple is still the largest equity holding in the portfolio. | The lesson: Even Buffett locks in gains when he thinks tax rates may rise. The patience to hold isn't infinite. The discipline to sell some of what you love when conditions change is part of the framework too. |
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| | The Lesser-Known Wins | Two of Buffett's biggest winners get talked about less than they deserve: | See's Candies (1972). Berkshire paid $25 million for the West Coast chocolate maker. It's still wholly owned and has thrown off more than $2 billion in cumulative pre-tax earnings, with minimal additional capital required to keep it running. Buffett has repeatedly called See's the purchase that taught him to pay up for great businesses rather than always hunt for the cheapest one. | The Japanese trading houses (2020). Right around his 90th birthday, Buffett disclosed stakes in Japan's five major trading conglomerates: Mitsubishi, Mitsui, Sumitomo, Itochu, and Marubeni. The original cost was around $7 billion. By late 2025, those positions were worth over $30 billion. Berkshire now holds more than 10% of all five. | The pattern across all of these: Buffett finds businesses he understands, buys them at sensible prices, and resists the constant urge to do something else. The compounding handles the heavy lifting. |
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| | A Quick Way to Pressure-Test Your Own Long-Term Holdings | If you're trying to build your own version of a long-hold portfolio, knowing what the alt-data is saying about the names you own is a useful gut-check. Our partners at AltIndex score thousands of stocks on a 0-100 scale based on hiring trends, web traffic, sentiment, and insider activity. Useful for checking whether the businesses you're holding still look like the businesses you originally bought. | Start a free 7-day trial of AltIndex → |
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| | 🫡 See You Soon | Buffett's secret isn't a complicated formula. It's that he found a strategy that worked and let it run for sixty years. | The reason 99% of his wealth came after age 50 is that compound interest is back-loaded by definition. The early years of compounding look boring. The last few years are where most of the money is actually made. | The takeaway, regardless of where you are in your investing life: find businesses you actually understand, pay sensible prices for them, and then sit on your hands. The patience to do that is the rarest and most valuable thing in the market. | That's our take, and that's today's edition. See you tomorrow. | — Brandon & Blake of Invested Inc |
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| | ⭐️ What did you think of today's edition? | |
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| | | | Thumbnail image: Michael Reuter, Flickr | The information provided in Stocks & Income is for informational and educational purposes only and should not be construed as financial advice, investment advice, or a recommendation to buy or sell any securities. Stocks & Income is not a registered investment advisor, broker-dealer, or licensed financial planner. Always do your own research and consult with a licensed financial advisor before making any investment decisions. We may hold positions in or receive compensation from the companies or products mentioned. Disclosures will be made where applicable. | Stocks & Income, AltIndex, Finance Wrapped, The Chain, and Future Funders are all owned by Invested, Inc. |
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