Little did the billionaire investor Warren Buffett know that he would stand to make quite a bit on a Trump victory.
Towards the conclusion of the presidential campaign Warren Buffett did not sugar coat his reservations against then presidential hopeful Donald Trump. However despite his opposition, Buffett, who voiced his support for Hillary Clinton, was among the biggest gainers of the post-election Trump rally.
Last month (November) Berkshire Hathaway (NYSE:BRK.A,BRK.B) had its best month in the market in almost a decade – 6 years to be exact. Berkshire’s shares are currently trading at around $240,000, which is close to its all-time best.
When it comes to investing his money, Buffett may not be a huge fan of tech companies, but his Berkshire Hathaway (NYSE:BRK.A,BRK.B) stands tall among the tech crowd. The investor’s firm is ranked as fourth largest company in terms of market cap. It is right behind tech giants like, Apple (NASDAQ:APPL), Alphabet (NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN).
Berkshire Hathaway (NYSE:BRK.A,BRK.B) was among the biggest winners of the market’s rally. Even though both Class A and B shares went down a bit on Friday, the Class A shares have gone up by 7.9%, whereas Class B are up by 7.8% since the results.
There is certainly no love lost between Buffett and Trump. The president-elect verbally accused the investor of taking huge tax deductions. As a result Buffett made his tax information public and asked Trump to follow suit. He also said now that Trump has claimed victory, he “deserves everybody’s respect.”
According to Keefe, Bruyette & Woods’ managing director Meyer Shields “there is this sense that after this surprise election, under President Trump there will be more rapid growth than there would have been otherwise.”
Lountzis Asset Management’s President, Paul Lountzis believes investors are going to be attracted to Berkshire Hathaway (NYSE:BRK.A,BRK.B) mainly because of Buffett’s value investment strategy. He believes the investor can outperform when the rest of the market takes a dive. Lountzis says that investors may see Berkshire Hathaway (NYSE:BRK.A,BRK.B) as a safe bet because of its “broad diverse set of revenues”. He further said that whenever equities went south, Berkshire managed to stay afloat.
One of the main reasons for a post-election rally is the soon-to-be president’s promise to cut taxes and ease regulations for U.S. companies. Trump who has been vocal about bringing manufacturing back to the United States promises to offer massive tax incentives to companies that do so. Since the election, the S&P 500 has gone up by 2.4%.