Berkshire Hathaway’s big mystery stock wager could be revealed soon

cnbc.com:

In this article

Berkshire Hathaway, led by legendary investor Warren Buffett, has been making a confidential wager on the financial industry since the third quarter of last year.

The identity of the stock — or stocks — that Berkshire has been snapping up could be revealed Saturday at the company's annual shareholder meeting in Omaha, Nebraska.

That's because unless Berkshire has been granted confidential treatment on the investment for a third quarter in a row, the stake will be disclosed in filings later this month. So the 93-year-old Berkshire CEO may decide to explain his rationale to the thousands of investors flocking to the gathering.

The bet, shrouded in mystery, has captivated Berkshire investors since it first appeared in disclosures late last year. At a time when Buffett has been a net seller of stocks and lamented a dearth of opportunities capable of «truly moving the needle at Berkshire,» he has apparently found something he likes — and in the financial realm no less.

That's an area he has dialed back on in recent years over concerns about rising loan defaults. High interest rates have taken a toll on some financial players like regional U.S. banks, while making the yield on Berkshire's cash pile in instruments like T-bills suddenly attractive.

«When you are the G.O.A.T. of investing, people are interested in what you think is good,» said Glenview Trust Co. Chief Investment Officer Bill Stone, using an acronym for Greatest of All Time. «What makes it even more exciting is that banks are in his circle of competence.»

Under Buffett, Berkshire has trounced the S&P 500 over nearly six decades with a 19.8% compounded annual gain, compared to the 10.2% yearly rise of the index.

Coverage note: The annual meeting