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Sound Advice: April 23, 2025

Has Warren Buffett outperformed the market indexes? 

Warren Buffett's performance relative to market indexes has varied over different time periods:

Long-term Performance

Over the long term, Warren Buffett has significantly outperformed market indexes. From 1965 to 2024, Berkshire Hathaway achieved an average annual return of 19.9% over 59 years, resulting in a total gain of 5,502,284%. In comparison, the S&P 500 index posted an average annual return of 10.4% during the same timeframe.

Recent Performance

In recent years, Buffett's performance has been mixed:

  • 2025 (Year-to-date): Berkshire Hathaway stock has jumped 16% while the S&P 500 has dropped 2% 

  • 2024: Berkshire outperformed the S&P 500, with returns of 25.5% compared to 25%.

  • 2022: Berkshire's stock increased by 4% while the S&P 500 fell by 18%.

  • 2009-2023: Berkshire's annual return averaged 13%, compared to 15% for the S&P 500.

Market Downturns

Buffett's approach has shown particular strength during market downturns. Under his leadership, Berkshire stock "substantially outperformed" the market in 10 of the 12 years the S&P declined.

Conclusion

Although there have been periods where Buffett has underperformed, his long-term track record and performance during market downturns demonstrate his ability to outperform market indexes over extended periods. However, as Berkshire Hathaway has grown to a $1 trillion valuation, Buffett has acknowledged that matching past growth rates has become more challenging.


N. Russell Wayne


203.895.8877


www.soundasset.blogspot.com


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