Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) is widely regarded as one of the greatest performing stocks in market history, and the numbers support that claim.
Between 1965 and 2025, Berkshire generated compound annual gains of 19.7% and a total gain of an astonishing 6,099,294%, dwarfing the S&P 500’s comparable total gain of 46,061%.
The S&P 500 produced compound annual gains of 10.5% over the same period, a strong result in its own right, but nowhere near what Berkshire delivered under Warren Buffett’s leadership.
Buffett, who stepped down as CEO at the end of last year, built Berkshire’s extraordinary track record around one consistent and well-documented investing philosophy that time has never disproven.
In his 1996 annual letter to shareholders, Buffett advised investors to focus on purchasing businesses that are easy to understand and “whose earnings are virtually certain to be materially higher five, 10, and 20 years from now.”
He was equally clear about the risks of abandoning that mindset, warning that only a handful of companies can truly meet that bar and that investors will be tempted to stray from disciplined thinking.
“If you aren’t willing to own a stock for 10 years, don’t even think about owning it for 10 minutes,” Buffett wrote in that same letter, a line that has resonated with long-term investors for decades.
Today’s market environment makes that discipline harder to maintain, with frequent stories of retail investors generating extreme returns from meme stocks, meme coins, leveraged options trades, and concentrated bets on artificial intelligence.
Buffett’s approach has always stood apart from those strategies, favouring stocks capable of performing across down, steady, and rising markets rather than chasing whatever theme is generating headlines.
Coca-Cola, one of Berkshire’s largest holdings acquired in the late 1980s, illustrates this principle clearly, as the stock has risen nearly 26% this year, trouncing the broader market while AI-focused trades face growing anxiety among investors.
Coca-Cola’s strong brand and expanding beverage portfolio have created a durable competitive moat, making it one of the most defensive consumer staples stocks available to long-term investors.
History has consistently shown that the longer investors hold quality stocks, the less likely they are to lose money, though that outcome is never guaranteed regardless of holding period.
Stocks that lack a clear path to profitability, burn through cash, and trade at extreme valuations can still disappoint investors even over a decade-long time horizon, which is why stock selection remains critical.
Buffett’s philosophy does not demand extraordinary growth every single year, but instead rewards consistent, high-quality earnings growth over those that deliver brief spikes followed by steep declines.
Investors who adopt that patient, disciplined mindset, selecting businesses with durable earnings power and holding them through inevitable market volatility, give themselves the best realistic chance of building long-term wealth.
