Warren Buffett is an investor that has truly scaled his investments to a size that is almost impossible to conceive. However, Buffett is quick to point out that compounding small sums is much easier than large. And the larger the sum you start with, the harder it become to continue to compound it over time.
“I think, working with a very small sum, that there is an opportunity to earn very high returns,” Buffett said at the 1999 Berkshire Hathaway annual meeting. “But that advantage disappears very rapidly as the money compounds.”
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© 2023 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.