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OverlookedAlpha OP t1_iru6gq4 wrote

Source: FMP (financial modelling prep) Visualisation: R

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HothHanSolo t1_iru8eqk wrote

OP, can you please explain what both of those things are?

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not_right t1_iru8lob wrote

A static chart would be so much better than a looping gif.

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Skierdude11 t1_irucrrr wrote

Looks like the return percentages if you bought Berkshire Hathaway stock (grey) and the ARK ETF (red) at the beginning of 2020.

Warren Buffet (Berkshire Hathaway) has a certain investment strategy that he has shown returns slow and steady growth. On the other hand, Cathie Wood (ARK Innovation) has a different strategy that gave her ton of attention mid-pandemic for its super high returns, but is now showing that it isn’t as stable of returns.

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cozitburns t1_irudarx wrote

Slow and steady win the race

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roadtrip-ne t1_irufmzf wrote

Yeah- but since 2020, BRK.B has been around since 1996. Slow and steady isn’t too much a surprise.

ARKK hit the market at full hype all time high, and went with a bunch of ATH hyped tickers like Zoom and Coinbase

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WhistleMeThis_ t1_iruhikk wrote

Wish I could comment gifs on mobile. The Palpatine “Ironic, isn’t it?” seems very fitting here.

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OverlookedAlpha OP t1_irup69j wrote

Berkshire Hathaway is Warren Buffett's company that he uses to invest in businesses like Apple, Occidental Petroleum, Coca-Cola etc.

ARKK is fund manager Cathie Wood's Innovation ETF. This ETF invests in a selection of companies that ARK believes are the 'future'. However, the ARKK ETF has been criticised for investing in unprofitable businesses which have tanked since the pandemic.

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danceswithtree t1_iruxbx4 wrote

I guess that's my point of bringing up the S&P. There are plenty of funds that beat the S&P for any given year. Almost none can do it consistently. That's what made Buffet and Berkshire notable-- the long term performance.

I would imagine that if you plot the distribution of returns for all the funds, it would approach a normal distribution. For the top performers (eg >3 sigma), what is their performance the next year? My gut feeling us that risky investments will increase the variance in returns-- those in the highest returns and highest losses will have risky strategies. So does past performance inform future performance? Maybe? All the commercials for investments want you to think so but explicitly say they don't.

So during the period in question, did Berkshire do better than the S&P?

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Mr_Owl42 t1_iruyb4p wrote

It's like Jeff Goldblum said, "Berkshire... uh... Hathaway".

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theMonkeyTrap t1_irv224v wrote

the thing I dont like about these charts is they are very start and end specific & results can vary greatly for somewhat different intervals. Supposedly you could fix that by using moving averages over say 30 or 60 days but I have almost never seen anybody do it.

Also regarding the comparison itself, IIRC there was a good buffet quote .."In short term markets are voting machine but in long term they behave as weighing machine". definitely applies in this case.

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dude_who_could t1_irv5u0r wrote

Now show a 50/50 split reallocated quarterly.

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HidesInsideYou t1_irvdxbi wrote

The animation adds negative value to trying to understand what you're presenting

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LakeSun t1_irw31e2 wrote

Can you guess when Cathie Woods came under short attack.

You should actually send this to the SEC.

And by short attack, of course, I mean: 'naked short' attack. The preferred method of the short community.

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grae_n t1_irx286p wrote

From a data story telling perspective, I feel like having a static graph would have ruined hare racing ahead aspect. The animation would have seemed much less dramatic.

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IMovedYourCheese t1_irxy8bx wrote

Berkshire Hathaway, S&P 500, VTI and most other broad market funds are all very tightly correlated, so this chart is really ARKK vs the overall stock market.

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secoccular t1_iry83lo wrote

Better than slightly better returns. Berkshire Hathaway has an annualized return of 20.1% since 1965. The S&P500 has been 10.5% annualized.

Total BRK return since 1965: 3,641,613%

Total SPX return since 1965: 30,209%

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