Mark Mobius is betting big on Taiwan, after warning against putting money into China.
“Taiwan is now our largest allocation,” the billionaire investor told Bloomberg TV.
Mobius’ focus on Taiwan is spurred by his bullish outlook on the semiconductor industry.
Warren Buffett’s luck changed this year, allowing him to spend a record sum on stocks and end his deal drought. Here are his 6 highlights of 2022.
Warren Buffett spent a record sum on stocks and made a major acquisition in 2022.
The Berkshire Hathaway CEO tore into bitcoin, adjusted some overseas bets, and gave a surprise gift.
Here are the investing icon’s 6 highlights of 2022.
Warren Buffett’s luck changed in 2022. After years of battling to find bargains and watching Berkshire Hathaway‘s cash stack up, the famed investor seized his chance to put his conglomerate’s mountain of money to work.
Buffett spent a record sum on stocks, executed a major acquisition, and made some striking changes to his overseas bets. He also crowed about four of Berkshire’s key holdings in his yearly letter, trashed bitcoin at the annual shareholders’ meeting, and made a surprise donation to his children’s charities.
Here are Buffett’s 6 highlights from 2022:
The annual letter
Buffett published his famous annual letter to Berkshire shareholders in February.
The investor vented his frustration with Berkshire’s mammoth $144 billion cash pile, blaming a lack of bargains in the stock market. He also celebrated the “Four Giants” among Berkshire’s businesses: insurance, railroads, energy, and its enormous Apple stake.
Moreover, Buffett appeared to respond to criticism of his tax practices by noting Berkshire paid $3.3 billion of federal income tax in 2021 — nearly 1% of all the corporate income taxes collected by the US government that year.
Buffett struck a deal to buy Alleghany for nearly $12 billion in March. Berkshire completed its takeover of the insurer in October, ending a years-long drought on the acquisition front.
The investor showcased his trademark approach to dealmaking, which prizes trust and simplicity. He proposed the merger over dinner with Alleghany’s CEO, who previously ran a Berkshire subsidiary, and the pair formally announced a deal less than two weeks later.
Buffet also refused to budge on the deal terms, and when Alleghany enlisted Goldman Sachs as a financial advisor, he insisted the investment bank’s fee was subtracted from Berkshire’s offer price.
An epic buying spree
Berkshire plowed a net $41 billion into stocks in the first quarter of 2022, setting a new record for its quarterly spending on equities.
Buffett and his team built large stakes in HP, Chevron, Occidental Petroleum, Citigroup, Paramount, and Taiwan Semiconductor in the first nine months of 2022. Berkshire also spent over $5 billion on buybacks and made other sizeable purchases, lifting its spending on stocks and acquisitions for the year to an astounding $70 billion or so.
The annual meeting
Buffett hosted Berkshire’s annual shareholder meeting in his hometown of Omaha, Nebraska in April, after two years of virtual gatherings due to the pandemic.
The investor called out the reckless speculation in the stock market, underlined the grave threat posed by inflation, and declared he wouldn’t pay $25 for all the bitcoin in the world.
Buffett made some big moves in 2022 that deserve special attention. For example, he poured a total of about $30 billion into Chevron and Occidental, propelling the pair of oil-and-gas companies onto the list of Berkshire’s most-valuable holdings.
The investor and his team also revealed in November they had boosted their billion-dollar bets on Japan’s five largest trading houses.
In contrast, they sold BYD shares for the first time in 14 years. Berkshire has now slashed its position in the Chinese electric-vehicle maker by around 22%, and pocketed an estimated $1.2 billion profit from the disposals.
An unexpected gift
Buffett made his usual annual donation of Berkshire stock in June, dividing the $4 billion gift between the Bill & Melinda Gates Foundation and four of his family’s charities.
Unexpectedly, he contributed a further $759 million worth of Berkshire stock to his three children’s foundations for Thanksgiving, saying he was proud of their charitable work and wanted to show his appreciation.
7/7 SLIDES
Leading emerging markets investor Mark Mobius said Wednesday that most of his portfolio is focused in Taiwan, days after claiming that China had restricted him from taking his money out of the mainland.
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In a Bloomberg TV interview, the founding partner at Mobius Capital, said he is looking more closely at Chinese stocks, though he acknowledged that depends on what “China” includes.
“Taiwan is now our largest allocation. Of course, it’s Taiwan, a province of China,” Mobius said. “So in fact, we’re getting this exposure to China through Taiwan.”
The billionaire’s comments appeared to hew closer to Beijing’s stance, which describes Taiwan as part of its territory even as the island has been self-governing for decades with growing support for a formal declaration of independence from mainland China.
Meanwhile, his focus on Taiwan comes after he told Fox Business last week to be “very, very careful” when investing in China, claiming that he couldn’t pull his money out of an HSBC account in Shanghai.
“I can’t get my money out. The government is restricting the flow of money out of the country,” he said.
He added that the government hasn’t explicitly banned such outflows but said it is putting up numerous barriers.
“They don’t say, ‘No, you can’t get your money out,’ but they say, ‘Give us all the records from 20 years of how you’ve made this money,’ and so forth. It’s crazy.”
Chinese officials pushed back on his claims, saying no barriers had been set up. Mobius also indicated to a Hong Kong newspaper that the situation has since been resolved, though he didn’t provide specifics.
Mobius’ focus on Taiwan is spurred by his bullish outlook on the semiconductor industry, saying China and the US are pouring enormous sums into production and research within the sector.
The island is home to TSMC, the world’s largest manufacturer of semiconductor chips. Shares in the company have jumped 19% since the year’s start.
“The tech industry is number one for us, particularly anything related to semiconductors,” Mobius told Bloomberg TV, describing chips as the top category in his portfolio.
