<JeanDavid wrote: <<However, I had around 19 other stocks that did better, so that my present IRR for the last 12 months is just slightly under 45% according to Quicken.>> Vanguard S&P Index fund was up 47.44% for the year ending 4/16/98. It's a crazy world when a 45% return does not get bragging rights.>You are right there. Even Mr. Buffett had problems this year. As he said in his letter to the shareholders," Given our gain of 34.1%, it is tempting to declare victory and move on. But last year's performance was no great triumph: Any investor can chalk up large returns when stocks soar, as they did in 1997. In a bull market, one must avoid the error of the preening duck that quacks boastfully after a torrential rainstorm, thinking that its paddling skills have caused it to rise in the world. A right-thinking duck would instead compare its position after the downpour to that of the other ducks on the pond. So what's our duck rating for 1997? The table on the facing page shows that though we paddled furiously last year, passive ducks that simply invested in the S&P Index rose almost as fast as we did. Our appraisal of 1997's performance, then: Quack. "(The "Quack" was in about 6-point type.) Berkshire beat the S&P by about 0.7% last year (as measured by increase in book value).
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