Hood Sweeney Securities Head Brings Learnings Home from Berkshire Hathaway Annual Meeting
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Head of Financial Planning at Hood Sweeney Securities and Representative, Adrian Zoppa, crossed something off his bucket list, attending the Berkshire Hathaway Annual Meeting in Omaha, Nebraska last month.
Less than a year after taking the reins of Hood Sweeney Securities as Head of Financial Planning, Adrian was invited to join tens of thousands of shareholders in Berkshire Hathaway, led by the idolised investor Warren Buffett, for the first in-person annual meeting since 2019. The pandemic forced it online for the past two years.
“The opportunity to rub shoulders with some of the savviest investment managers in the world and hear from some of the most successful, makes me even more excited at the potential for Hood Sweeney Securities to serve its clients,” said Adrian Zoppa.
Hood Sweeney Securities has seven Representative Financial Planners covering strategy, investments and life insurance, managing $600Million in funds. The business has $10 Million+ Insurance Premiums under advice.
Adrian took the reins in July 2021 after almost a decade as a Director of Hood Sweeney Securities. He leads the team with fellow Director and, Representative Senior Financial Planner, Mark Mullins, and a senior team of advisers with extensive experience. This includes a Representative Senior Financial Planner with 15 years of international experience, including six years as Managing Director of an overseas Wealth Advisory firm.
The business also has an Investment Committee with three external consultants and a Board of four Directors, including an independent chair.
Adrian joined an Australian entourage to Berkshire Hathaway’s Omaha headquarters, led by Investment Committee member David Prescott, Managing Director and Portfolio Manager at Lanyon Asset Management Pty Limited.
Like many from around the world he jumped at the opportunity to hear from Warren Buffett, dubbed the Oracle of Omaha for his folksy but successful approach to investing only in businesses that he believes are great. Buffet’s (and Berkshire’s) strategy has long been ‘value investing, or investing in businesses with durable economic advantages and first-class management
On his return to the Adelaide team, Adrian said he was keen to share some key takeaways from the annual meeting with both his team and Hood Sweeney Securities’ clients.
“There was so much to learn from the Berkshire Hathaway Annual Meeting but there were three things about Berkshire Hathaway that really resonated for me in terms of the way we at Hood Sweeney Securities also approach our business,” said Adrian.
- Culture - enjoyment & empowerment are keys to long-term success.
Buffett said Berkshire Hathaway is “a business that exists for people to trust us, and all we have to do is fulfil that trust”. He said it’s a fairly simple thing given they have the resources to do it, and the freedom to do it.
- Cash is king.
Buffett: “We believe in having cash, there have been a few times in history, and will be more times in history, where if you don’t have it, you don’t get to play the next day. It’s like oxygen, it’s there all the time but if it disappears for a few minutes, it’s all over”
- Know when to Act.
After Buffett wrote in the annual letter that they “find little that excites us” in terms of stock purchases, the business spent approximately $40Billion in a short period in the first quarter. Vice Chairman Charlie Munger explained it simply that they “found some things we would prefer to own rather than Treasury Bills”.
Buffett said “the stock market is sometimes quite investment-oriented and other times it’s a casino turning over stocks. It’s like pulling the handle on slot machine”.
Buffett and his VPs also derided what they called “gambling” in the stock market. Buffett said that short-term swings in prices can be buying opportunities for Berkshire: “Sometimes markets do crazy things. That’s good for Berkshire, not because we’re smart…but because we’re sane.”
Said David Prescott, who led the group of 12 Australians to Omaha, five from Lanyon and seven clients and associates: “Berkshire has been one of the most studied investment firms on the planet for nearly 60 years and no one has replicated BRK’s returns over such a long period and at similar scale. This would suggest that intangible factors, such as investing culture and individual temperament and brilliance, play a large part in investment returns, and are difficult to teach.”
While Warren Buffett and his three vice chairmen presented to shareholders and answered questions for more than five hours, Prescott said the chance of asking a question or meeting Buffett personally are always slim. “Saying that, as always, the discussion was valuable, and you leave with both reinforcement of core, sensible investing principles together with a new perspective,” said Prescott.
With inflation on the radar globally, Buffett built on his prior remarks that inflation “swindles” equity investors, noting last week that it “swindles the bond investor, too. It swindles the person who keeps their cash under their mattress. It swindles almost everybody.”
He added that predicting future inflation is a fool’s game, and that no one can really know how much inflation there will be over the next 10 years, or 12 months, or four weeks. He said the best defence against inflation is to be skilled at what you do, and to produce a good or service that will remain in demand, and which people will be willing to pay for.