Lou Simpson

SQ Advisors, LLC

Last Update: 2013-05-15

Number of Stocks: 15
Number of New Stocks: 0

Total Value: $1,586 Mil
Q/Q Turnover: 19%

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Lou Simpson's Profile & Performance

Profile

Buffett met Simpson in 1996 when he was CEO of Geico's capital operations and Buffett was completing his purchase of Geico. Impressed with his track record, Buffett kept Simpson on as chief investment officer.

At his retirement from Berkshire subsidiary Geico in 2010, Simpson managed more than $4 billion worth of stocks. Throughout his time with Berkshire, Simpson and Buffett’s stock picks overlapped sometimes due to similarities in their thinking, but both men clearly had independent processes and disagreed with each other sometimes as well.

Before joining GEICO in 1979 as senior vice president and chief investment officer, Simpson was president and CEO of Western Asset Management, a partner at Stein Roe and Farnham, and an economics instructor at Princeton University.

Investing Philosophy

Buffett frequently sang the praises of Lou Simpson. Once, in his 2004 investor letter, Buffett called him “a cinch to be inducted into the investment Hall of Fame” based on his return performance history. From 1980 to 2004, Simpson produced an average annual gain of 20.3%, compared to 13.5% for the S&P 500. In that time, he had only three negative years, and only four years of less than double-digit returns.

Later, in 2006, Buffett intimated that Simpson, “a top-notch investor with an outstanding long-term record,” would be the natural replacement for him as CEO of Berkshire, were Simpson not a mere six years younger than him.

In a rare interview, Simpson in 2010 told the Chicago Tribune upon his retirement: "My approach is eclectic. I try to read all company documents carefully. We try to talk to competitors. We try to find people more knowledgeable about the business than we are. We do not rely on Wall Street-generated research. We do our own research. We try to meet with top management."

Total Holding History

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Top Ranked Articles

How Does Lou Simpson's Stock Portfolio Compare to Warren Buffett's Stock Portfolio?

August 24, 2010

Lou Simpson is the only person at Berkshire Hathaway (BRK.B) other than Warren Buffett who buys and sells stocks. Buffett makes all investment decisions for Berkshire’s insurance companies with the exception of GEICO. Lou Simpson runs GEICO’s stock portfolio. Simpson, 73, will retire in December. Buffett, 79, will take over GEICO’s portfolio. Until then, the two stock portfolios are kept separate. Media reports confuse which man bought which stocks. As I explained in yesterday’s article, there’s no reason to make that mistake. Berkshire’s 13F report to the SEC shows which investments are GEICO’s and which investments are not. Read more...

What Stocks Does Lou Simpson Own? And What Stocks Does Warren Buffett Own?

August 23, 2010

Over the weekend, The Chicago Tribune reported that Lou Simpson, the man who manages GEICO’s investment portfolio for Berkshire Hathaway (BRK.B), is retiring. Simpson, 73, is the only person at Berkshire Hathaway other than Warren Buffett who picks stocks. Buffett makes all investment decisions for Berkshire’s other insurance companies. Buffet does not, however, buy or sell stocks in GEICO’s portfolio. Only Simpson does that. In December, that will change. Simpson will retire. And Buffett will take over GEICO’s portfolio. Read more...

Meet Lou Simpson, Former Investment Star at Berkshire and New GuruFocus Guru

January 3, 2013

Many people connect Warren Buffett with his right-hand man, Charlie Munger. Fewer know, however, that up until a few years ago, a third mastermind made investing decisions at Berkshire Hathaway (BRK.A)(BRK.B), Lou Simpson. Now that Simpson has founded his own firm, SQ Advisors LLC, GuruFocus today began to track the investor as its latest Guru. Read more...

Former Berkshire Stock Picker Lou Simpson Opens Own Shop

January 21, 2011

Louis Simpson, the investor who picked stocks on behalf of billionaire Warren Buffett’s Berkshire Hathaway Inc. for more than a decade before stepping down, is going into business for himself. Read more...

You Might Think You're Copying Buffett...

November 18, 2009

Recently, Berkshire filed its mandatory disclosures detailing its positions in various securities. As a result, you will undoubtedly see headlines beginning "Buffet Buys X Stock" and "Buffett Sells Y Stock". And when word gets out that Buffett has bought a particular stock, its shares jump immediately. After all, if the Oracle of Omaha wants into a company, surely it has a bright future, right? Unfortunately, determining whether Buffett has actually bought a company is not so easy. Read more...

» More Lou Simpson Articles

Commentaries and Stories

Currently 4.85/5

Rating: 4.8/5 (13 votes)

Former Berkshire Stock Investor Lou Simpson’s 15 Stock Portfolio

March 15, 2013

One would think that it investing cash in equities on behalf of Warren Buffett would be a very stressful job. I mean you are entrusted with cash that could be invested by Buffett himself. More...

Currently 2.67/5

Rating: 2.7/5 (3 votes)

Lowe's Is Helped by Hurricane Sandy, While Market Valuations Remain Rich

February 25, 2013

U.S. equity markets look to continue Friday’s rally despite higher oil prices and relatively rich market valuations. At current levels, the market is trading at a Shiller P/E of 22.7 versus a historical mean of 16.5 with earnings season continue throughout the week and M&A activity picking up in the last month. More...

Currently 3.60/5

Rating: 3.6/5 (5 votes)

Lou Simpson Buys Moody's Corp, Oracle Corp, Brookfield Asset Management, Sells Fiserv, Dell, Lowe's Companies

February 18, 2013

Lou Simpson, an investor that Warren Buffett trusts, just reported his fourth quarter portfolio. Lou Simpson buys Moody's Corporation, Oracle Corporation, Brookfield Asset Management Inc., Valeant Pharmaceuticals International Inc., Charles Schwab Corp, sells Fiserv Inc., Dell Inc., Lowe's Companies Inc. during the three months ended 12/31/2012, according to the most recent filings of his investment company, SQ Advisors LLC. As of 12/31/2012, SQ Advisors LLC owns 16 stocks with a total value of $1.2 billion. These are the details of the buys and sells. More...

Currently 3.83/5

Rating: 3.8/5 (6 votes)

New Guru Lou Simpson’s Top-Yielding Stocks

January 4, 2013

SQ Advisors head and Buffett comrade Lou Simpson runs a pretty concentrated portfolio, with only 15 stocks, the majority weighted in the financial sector. Valued about $1.2 billion, with a quarter-over-quarter turnover rate of 9 percent, about 10 of Simpsons’ stocks pay dividends. More...

Currently 4.07/5

Rating: 4.1/5 (14 votes)

Meet Lou Simpson, Former Investment Star at Berkshire and New GuruFocus Guru

January 3, 2013

Currently 3.71/5

Rating: 3.7/5 (7 votes)

Former Berkshire Investor Lou Simpson Is Buying Chesapeake Energy – Chesapeake CEO Explains Why You Should Too

November 17, 2011

I’m long Chesapeake Energy (CHK). I think at current commodity prices it is a good investment. If natural gas ever rebounds to $6 I think it is a giant home run. More...

Currently 3.58/5

Rating: 3.6/5 (12 votes)

Former Berkshire Stock Picker Lou Simpson Opens Own Shop

January 21, 2011

Currently 4.75/5

Rating: 4.8/5 (28 votes)

How Does Lou Simpson's Stock Portfolio Compare to Warren Buffett's Stock Portfolio?

August 24, 2010

Currently 4.12/5

Rating: 4.1/5 (17 votes)

What Stocks Does Lou Simpson Own? And What Stocks Does Warren Buffett Own?

August 23, 2010

Currently 4.00/5

Rating: 4.0/5 (6 votes)

You Might Think You're Copying Buffett...

November 18, 2009

Currently 0.00/5

Rating: 0.0/5 (0 votes)

A Maestro of Investments in the Style of Buffett

April 24, 2007

Mr. Simpson, 70, has long overseen the investment portfolio of Geico, the insurance company Berkshire owns, which is now valued at more than $4 billion. He is also the only man other than Mr. Buffett who has managed stock investments in Berkshire’s portfolio. More...