Should You Buy Berkshire Hathaway or Vanguard Financials Index ETF?
On the surface, comparing a company to an exchange-traded fund (ETF) is obviously not an apples-to-apples comparison. But the lines get blurred a little bit when the company in question is Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B), which is usually classified as a financial stock and is more of a conglomerate than it is a single company.Would investors be better off with an investment in Berkshire Hathaway today or in the Vanguard Financials Index ETF (NYSEMKT: VFH)?Tackling the easier-to-explain investment first, the Vanguard Financials Index ETF is, as its name implies, a sector ETF focused on financial stocks. It owns around 400 stocks. Its largest exposures are to diversified banks (20.2% of assets), transaction and payment processing services (15.6%), multisector holdings (9.3%), property & casualty insurance (9%), and financial exchanges and data (8%). Basically, it does what its name implies: provide broad exposure to the financial sector.Continue reading
On the surface, comparing a company to an exchange-traded fund (ETF) is obviously not an apples-to-apples comparison. But the lines get blurred a little bit when the company in question is Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B), which is usually classified as a financial stock and is more of a conglomerate than it is a single company.
Would investors be better off with an investment in Berkshire Hathaway today or in the Vanguard Financials Index ETF (NYSEMKT: VFH)?
Tackling the easier-to-explain investment first, the Vanguard Financials Index ETF is, as its name implies, a sector ETF focused on financial stocks. It owns around 400 stocks. Its largest exposures are to diversified banks (20.2% of assets), transaction and payment processing services (15.6%), multisector holdings (9.3%), property & casualty insurance (9%), and financial exchanges and data (8%). Basically, it does what its name implies: provide broad exposure to the financial sector.
