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The market is becoming more and more dominated by the Big 5.
MSFT, AAPL, GOOG/L, AMZN, and FB are now almost 23% of the S&P 500.
The same stocks are almost 50% of the NASDAQ 100.
Many investors’ portfolios are becoming more and more concentrated.
The market is encouraging this behavior.
Value buying is losing more and more to ‘growth (momo)’ stocks.
Portfolios that hold financials, industrials, and energy just are not popular.
Perhaps this is why ‘the Oracle of Omaha’ is losing so much ground.
Berkshire Hathaway is near March levels now.
Interestingly, the option premium is getting cheaper and cheaper and cheaper.
BRK.B has a ton of cash, they have a giant holding in AAPL and KO.
But…it owns restaurants, banks, Boeing, and a railroad company.
This is not a portfolio that has ‘Cashay’ and you can tell in the stock.
With the IV this cheap and our knowledge that at SOME POINT…
…people will want to own these stocks.
Calls in BRK.B might make some sense.
Your Only Option,
Mark
P.S. – I mention Berkshire because my special portfolio that trades options around the Oracle, has been killing it and yes…doing better than he does. Options give us the ability to do things others can’t!
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