Should You Consider Adding To An Already Oversize Position In Berkshire?
- Traders advocate doing more of what works and less of what doesn't; does this maxim apply to value investors?
- Berkshire Hathaway has become in recent years an oversize part of my portfolio. Is there a rationale for adding to it?
- Bayes Theorem implies that affirmative new information should increase one's conviction (justifying increasingly large position size in a stock).
- I have owned and followed Berkshire for more than 25 years, in the process not only gathering information but also improving my ability to analyze that information.
- Berkshire's success is not so smooth as to raise doubt (like Madoff or LTCM), but is enough to confirm Berkshire as the real deal - a low-risk compounding machine.