So you think you know Buffett’s secret investment strategy. What is it? Buffet is a value investor who buys companies at deep value. Ask this question to any investor in financial world and he/she would respond with this answer with a blink of an eye. That’s true and correct. But another significant characteristics of Buffett’s portfolio is dividend growth investing. Not much has been written about this aspect of Buffett’s portfolio. Let us take a little deeper look into Berkshire Hathaway’s (BRK) holdings and analyze them from dividend investing perspective.

As of 4Q 2008, BRK portfolio had a total of 60 companies. The total investments in top ten companies consist of approximately 85% of the portfolio while the remaining 15% is invested in 30 companies. Now, this could be viewed as a “highly concentrated portfolio” or “portfolio anchored to good stocks”. Has Buffett forgotten the meaning of diversification or he just does not believe in diversification per se?. The table below shows the top 10 holdings, their percentage in BRK portfolio, and dividends per share. Continue reading rest of this article…