Warren Buffett’s 5 Most Profitable Investments of All Time

2. Bank of America Corporation (NYSE: BAC)

Number of Hedge Fund Holders: 97    

Bank of America Corporation (NYSE: BAC) is a North Carolina-based financial services company founded in 1998. It is placed second on our list of Warren Buffett’s most profitable investments of all time. The stock has offered investors returns exceeding 74% in the past twelve months. Buffett first started buying stakes in the bank in 2011 at a reduced price and invested $5 billion initially, increasing his stake in the bank gradually afterwards. In 2017, he also made use of a previous warrant to buy more stake in the firm at a huge discount.

Bank of America Corporation (NYSE: BAC) now represents the second largest holding of Berkshire at close to 14.5% of its portfolio. The Nebraskan firm owns more than 1 billion shares in the bank worth over $39 billion. In the latter part of 2020, as Buffett sold his stakes in many top bank holdings, he actually added to his shares in Bank of America Corporation (NYSE: BAC), affirming his future bullish view on the firm. 

At the end of the first quarter of 2021, 97 hedge funds in the database of Insider Monkey held stakes worth $45 billion in Bank of America Corporation (NYSE: BAC), down from 99 in the previous quarter worth $35 billion.

In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Bank of America Corporation (NYSE: BAC) was one of them. Here is what the fund said:

“Higher long-term interest rates supported financials such as Bank of America, which has shown both defensive and offensive characteristics in the past year. We believe it continues to be the least risky large bank from a credit standpoint, with conservative underwriting and controlled risk taking, a leading consumer deposit franchise, scale and technology. It is also a leader in its commitments to sustainability, or as it terms it, responsible growth. Disclosure and reporting at all levels form a large part of this commitment, including gender diversity and equality, environmental commitments and support of communities in which it operates. In the first quarter Bank of America announced it is setting a goal of net-zero greenhouse gas (GHG) emissions in its supply chain and operations, and notably also in its financing activities, before 2050.”