Between 2019 and 2020 Warren Buffett’s Berkshire Hathaway (NYSE:BRK) underperformed the S&P500 by 37%. It was one of the poorer periods of relative performance for the Oracle of Omaha, who was “burdened” with loads of cash and missed out on a lot of the boom in technology stocks.

As you can see, Buffett regularly lags the broader index. And sometimes for years at a time, as was the case between 2003 and 2005.

We all know the bigger picture, of course. Berkshire has done much, MUCH better than the market average over the decades, and it’s worth noting that this isn’t just due to early success. The company has a decent lead over the market for the last 3, 5 & 10 year periods too.

Indeed, since mid-2020, Berkshire’s stock has done twice as well as the market.

The point of this isn’t to gush over how awesome Uncle Warren is.

It’s just a useful reminder that if one of the world’s greatest investors is not immune to long stretches of underperformance (and even of going backwards in bull markets) it’s unrealistic to think that we can hope to avoid the same indignity.

What matters is having a sensible strategy, and being consistent in its application — even when it seems you’ve lost your mojo.

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