How Charlie Munger's $2.6 Billion Net Worth Was Concentrated in Just 3 Bets—And What Happened Since

Rejecting Diversification: Munger’s Bold Investment Philosophy

Charlie Munger, the longtime vice chairman of Berkshire Hathaway, famously rejected conventional wisdom about portfolio diversification. At a 2017 conference, he disclosed that nearly his entire charlie munger net worth—approximately $2.6 billion—was deployed across merely three investments. Munger characterized diversification as “a rule for those who don’t know anything,” a stance that mirrored his partner Warren Buffett’s belief that spreading capital too thinly made little sense for seasoned investors.

This wasn’t bravado. Before joining Berkshire, Munger operated his own investment vehicle that generated 19.5% average annual returns between 1962 and 1975, crushing the Dow Jones Industrial Average by nearly fourfold. His strategy centered on identifying companies with durable competitive advantages—or “economic moats”—that could withstand market cycles and competitive pressures.

Three Unwavering Convictions: Where the Money Actually Went

Munger’s concentrated portfolio centered on businesses he fundamentally understood and trusted:

Costco Wholesale—The Retailer He Couldn’t Resist

Munger served as a board member at Costco Wholesale for decades, openly calling himself “utterly addicted” to the company. By 2022, he owned over 187,000 shares valued at roughly $110 million, making it his second-largest single holding. His commitment was absolute: he promised never to liquidate a single share.

Since his passing in November 2023, Costco has demonstrated why Munger’s conviction held. The stock delivered a 47% return while management increased dividends by 27% and distributed a special $15-per-share payout in January 2024. That special dividend alone yielded 2.3% for shareholders at record date.

Himalaya Capital—The Private Fund Opportunity

In the early 2000s, Munger delegated $88 million to Li Lu, a fund manager earning the moniker “Chinese Warren Buffett” for applying value investing principles to emerging markets. Li’s Himalaya Capital follows the investing blueprint of Buffett, Munger, and Benjamin Graham.

As a private hedge fund, Himalaya doesn’t publicize performance, but signals emerge from its disclosed positions. Alphabet—comprising nearly 40% of fund assets under management in the latest filing—surged 130% since Munger’s death. Berkshire Hathaway, another core holding, also appreciated significantly during the same window.

Berkshire Hathaway—The Core Conviction

Munger’s largest holding was unquestionably Berkshire Hathaway itself. While his net worth reached only $2.6 billion compared to Buffett’s vastly larger fortune, a striking fact emerged: Munger had sold or donated 75% of his original 18,829 Class A shares from 1996. Had he retained everything, his wealth would have approached $10 billion.

At death, he held 4,033 Class A shares valued near $2.2 billion—representing almost 90% of his total wealth. Since November 2023, Berkshire Class A shares climbed 37%.

Measuring Results: Concentrated Bets Against the Broader Market

The returns tell a nuanced story. Over the two-year-plus span following Munger’s passing:

• Berkshire Hathaway Class A: +38%
• Costco Wholesale: +47%
• S&P 500: +52%

While these concentrated positions underperformed the broader index, the comparison obscures a critical insight. Both Costco and Berkshire represent business models with fortress-like fundamentals and pricing power—characteristics typically associated with lower volatility and downside resilience. The S&P 500’s outperformance occurred during a period when value investing fell from favor, yet Munger’s portfolio still delivered double-digit annual gains.

The Lasting Lesson Behind Munger’s Concentrated Strategy

Munger’s approach challenges the institutional push toward passive diversification. By limiting himself to three vetted investments, he wagered that deep knowledge and conviction trumped broad exposure. His charlie munger net worth concentration reflected not recklessness but rather ruthless confidence in a handful of sustainable competitive advantages.

Even with Munger no longer guiding decisions, the endurance of his three core holdings suggests that the principles animating his strategy—patient capital, moat identification, and managerial quality—remain as potent today as they were decades ago. The markets have evolved, valuations have shifted, yet the fundamentals of his thesis persist in generating returns that conservative investors find compelling.