Warren Buffett has beaten the market to such an extreme degree that comparing his success to everyone else can’t be done using a normal line chart.
Business Insider compared the historical performance of Berkshire Hathaway’s stock price from a 2001 retrospective and Yahoo Finance to the performance of the S&P 500 since Buffett bought the company in 1964.
Berkshire Hathaway’s stock price increased by a mind-blowing 1,000,000% between December 1964 and December 2015. The S&P 500, on the other hand, increased by “only” about 2,300% over that time.
Here’s a chart showing the evolution of both Berkshire Hathaway’s stock price and the S&P 500. Berkshire outperformed the broader stock market by so much that the only way to meaningfully compare the two is on a logarithmic scale, in which the vertical axis represents powers of ten:
Another way to look at Buffett’s superhuman investing powers is to compare annual growth rates of Berkshire stock and the broader stock market. Since year to year changes are extremely noisy and volatile, we made a chart showing the five-year moving average annual price returns for both Berkshire’s stock and the S&P 500 since Buffett’s takeover:
Through the end of the 20th century, Buffett handily outperformed equities as a whole. Since 1999, he’s still tended to beat the market, but by a more modest amount.
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