For those who bet correctly on the S&P 500 last year, which rose 30%, you won’t have the difficulty reading this that others might. While that same index has started 2014 down nearly 6%, that’s almost to be expected.
On Monday, Gregory Zuckerman of The Wall Street Journal detailed the executives who saw the biggest paper gains in their own companies, and not surprisingly some of the more common household names were among the biggest winners. Of course, paper gains are only gains on paper until these same executives liquidate their holdings.
The LF Brook Absolute Return Fund lost -2.52% in the second quarter of 2021, compared to a positive performance of 7.59% for its benchmark, the MSCI Daily TR Net World Index. Year-to-date the fund has returned 4.6% compared to 11.9% for its benchmark. Q2 2021 hedge fund letters, conferences and more According to a copy Read More
The big winners
Among the biggest winners were some of the world’s richest men: Mark Zuckerberg, Jeff Bezos, and Warren Buffett. We’re talking multi-billion dollar gains owing to the year each of their companies enjoyed.
Top 20 executives
That’s not to say that these three were alone. The top 20 executives with the largest ownership stakes in S&P 500 (INDEXSP:.INX) companies earned $80.9 billion on paper but collectively they also sold shares worth $7.3 billion. It should be noted that the $80.9 billion does not include options.
Last year, Facebook Inc (NASDAQ:FB) rose 105%; Amazon.com, Inc. (NASDAQ:AMZN), 59%; and Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B), 32%
Warren Buffett saw his holdings in Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) appreciate by $12.8 billion, while both Bezos and Zuckerberg saw a gain of $12 billion each. Respectively the latter two saw their year-end holdings soar to $33.9 billion and $23.3 billion.
Zuckerberg sold $2.3 billion worth of his stake in Facebook Inc (NASDAQ:FB), while Bezos shed just over $700 million of his stake in Amazon.com, Inc. (NASDAQ:AMZN). Buffett doesn’t sell his shares as a Berkshire spokesperson reiterated. “Mr. Buffett has never sold any shares at any time, including during the past year. All of his shares will go to philanthropic organizations,” she said.
Once again, paper gains are paper gains. Bill Gates once saw his stake in Microsoft Corporation (NASDAQ:MSFT) fall over $28 billion from September 1999 to September 2000 when Microsoft stock got hammered at the end of the tech boom. Illustrating this to a lesser extent, Buffett’s share has tumbled $2.8 billion since January 1.
While these three notables had huge years, the nature of hedge funds saw 2013 as less than fantastic.
“It was a tough year for hedge funds investing in stocks,” said Ken Heinz, president of HFR. “Bets against many stocks lost money, while many were too cautious on the market.”