I completely agree that Warren Buffett and Charlie Munger have done and still do a great job and have created an outstanding body of work.
I always follow Buffett's suggestions as well as all advice given by Munger. Due to this fact a general investment in Berkshire might be acceptable. But learning how they invest and trying to find companies on one's own seems to be in the long term a more promising approach. Good examples from my point of view are Sanofi (NYSE:SNY), Visa (NYSE:V) or Verisign (NASDAQ:VRSN), which are also in BRK's portfolio.
Buffett Taught Me Not To Buy A Stock Like Berkshire Hathaway
The main reason for my decision not to invest in Berkshire stock is based on Warren Buffett himself.
During the course of his career he coined many impressive quotations regarding capital markets. My argument is really simple. As we know, the "kiss" - principle (keep it short and simple) is, especially for capital markets, often the right path.
He once said: "I try to buy stock in business that are so wonderful that an idiot can run them. Because sooner or later, one will."
This point is already the most impressive reason not to buy BRK. A lot of the success of Berkshire is based on the unique intelligence of Buffett and Munger and their good noses for future investment opportunities. Of course, they may share their experience with a younger successor, but I'm sure it's not possible to copy this ingenuity. The dependence on management is huge, and management's brilliance is the main asset Berkshire has. The already mentioned perfect noses are the "patents" of BRK. Hence, it makes no difference who will be the successor because it won't be Buffett or Munger Vol.2.
Another two quotations go hand in hand. It's a sad fact that we all have to go sooner or later. So Buffett and Munger will too. At the age of 86 (Buffett is born in 1930) and 92 (Munger is born in 1924), respectively the two dudes are not at all that young anymore.
Therefore the statement "Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years" doesn't fit with an investment in BRK. The same applies to "Time is the friend of the wonderful company, the enemy of the mediocre".
I would like to see Buffett and Munger investing as long as possible but it wouldn't be a rational long-term investment without keeping these aspects in mind.
It will be really exciting to evaluate the development of BRK after Buffett and Munger, but honestly I would not choose to be an investor on the D-Day and the "day after tomorrow".
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.