Though the meeting typically takes place in Omaha, Nebraska, home to both Buffett and the company, this year’s event will be held in Los Angeles. (Due to the coronavirus pandemic, it will be closed to the public, just like last year’s meeting.)
Munger has consistently provided similar advice, telling the 2020 meeting that the best strategy for the “great mass of humanity” is to specialize in one area.
“Nobody wants to go to a doctor that’s half proctologist and half dentist, you know?” he said at the 2019 meeting. “So, the ordinary way to succeed is to narrowly specialize.”
The meetings have also included personal finance advice. Back in 2010, following the Great Recession, Buffett wrote in his letter to investors about the importance of cash.
“We pay a steep price to maintain our premier financial strength,” he said. “The $20 billion-plus of cash equivalent assets that we customarily hold is earning a pittance at present. But we sleep well.”
The Berkshire Hathaway empire
Berkshire is also a multinational holding company, meaning that it’s a conglomerate of numerous smaller companies.
These include businesses like GEICO, See’s Candies, Berkshire Hathaway Energy, Dairy Queen, Duracell, PacifiCorp, and Fruit of the Loom.
“It takes character to sit with all that cash and to do nothing,” Munger once said. “I didn’t get to be where I am by going after mediocre opportunities.”
Berkshire also holds shares in 41 publicly traded companies, including: Apple, Coca-Cola (KO), Kraft Heinz (KHC), American Express (AXP), Bank of America (BAC), and BNY Mellon (BK).
Berkshire is famous for its management philosophy, which focuses on a decentralized, trust-based, and hands-off relationship between Buffett and other executives who work within the company.
“What we do is not beyond anyone else’s competence,” Buffett once said. “I feel the same way about managing that I do about investing: It’s just not necessary to do extraordinary things to get extraordinary results.”
Coca-Cola is the company’s oldest stock position, with 23 million shares initially purchased back in 1988.
Since then, Coca-Cola stock has been up over 2,000%, and Berkshire now holds 400 million shares.
The company previously had holdings in four of the major airlines — Delta (DAL), Southwest (LUV), United (UAL), and American Airlines (AAL) — after spending between $7 billion-$8 billion on stakes back in 2016.
However, Berkshire revealed in May 2020 that it had elected to dump all four holdings as a result of the stocks tanking due to the coronavirus pandemic.
Berkshire also dipped its feet into the health care space, forming a joint venture with Amazon (AMZN) and JPMorgan (JPM) to create Haven, an attempt at reforming the health care system.