While I was writing my entry yesterday about Warren Buffett donating approximately $29.6 billion of Berkshire Hathaway stock to the Bill & Melinda Gates Foundation, I realized not only would this contribution be good for the health and education of people worldwide, but it also should benefit investors. (Before I was a writer and editor, I was a supervisor in customer service for a large brokerage firm and bank.)
As Buffett’s gift to the Gates Foundation is 10 million Class B shares of Berkshire Hathaway stock—not cash—both Bill Gates and Warren Buffett now have an interest in increasing Berkshire Hathaway’s stock price.
Hence, by buying Berkshire Hathaway, you now have the world’s richest and second richest men working on your behalf. Plus you push up the share price, helping the Gates Foundation get more money when it does sell some of the stock and, therefore, benefit international development. Admittedly my purchase of one share won’t do much, but it does help.
Furthermore, I figured the stock price would go down today, as people would sell their stocks upon hearing that the Oracle of Omaha’s was divesting himself of 85 percent of the company.
As I anticipated, shares of Berkshire Hathaway Class B (1/30 the ownership of a Class A share, which trades around $90,500) fell as much as $88 to $2,983 from its close on Friday. I bought it for $2,986.75 (not including the $9.99 commission).
And, as I also anticipated, other people like me were waiting for the drop and looking to buy: at the closing bell it had rebounded to $3,043.01, losing $19 on the day, but giving me a one-day return of 1.5 percent, although I have a long-term investment approach (confession: Berkshire Hathaway is a stock I’ve been considering buying for a few months).
Not a bad start though.