In 2010, the BRK Series was launched by JBG Structured Investments among intense publicity, as the product attempted to capitalise on the expertise of Warren Buffett.
It was the first structured product of its kind to offer exposure to Buffett’s Berkshire Hathaway B Shares. The first of the products matured this month and announced returns of 42.83%. JBG Structured Investments founder Justin Beeton said the products were reflecting the successes Berkshire Hathaway enjoyed as a result of Buffet’s $100 billion of investments made during and after the GFC.
“Since June 2012 Berkshire Hathaway A and B shares have risen nearly 35%, outstripping the rising US stock market and well above global equity returns,” he said.
Beeton said the average returns for Buffett’s investments over the past 50 years were just below 20% per annum. “While we’re pretty happy with the 43% – when you compare it to most other investments in Australia you’d say outstanding – however, performance was pretty shy of what Buffett has done consistently for 60 years.”
The Series 20 is currently up at 110% and Beeton is hoping it will stay there until it matures in October.
A new series of shares opens in June 2013. The minimum investment is $50,000.00. He says the investments are suited for growth-orientated investors. “There’s gearing, it’s a low interest rate environment so clients that are more aggressive, younger, want more money invested and exposure to Buffett.”