**Title:** New ETF Mimics Buffett’s Portfolio with 15% Yield
**Meta Description:** A new income-focused ETF based on Warren Buffett’s portfolio has raised $250 million, offering a 15% distribution rate since March.
**URL Slug:** berkshire-buffett-etf-15-percent-yield
**Headline:** New ETF Based on Warren Buffett’s Portfolio Delivers 15% Yield
The VistaShares Target 15 Berkshire Select Income ETF, inspired by Warren Buffett’s equity portfolio at Berkshire Hathaway, has successfully attracted nearly $250 million since its launch in March. This innovative fund has provided investors with a remarkable 15% distribution rate, making it an appealing option for income-seeking investors.
The ETF, which trades under the ticker symbol OMAH—reflecting Berkshire’s headquarters in Omaha, Nebraska—holds a diversified portfolio of 21 stocks. Notably, it allocates 10% of its assets to Berkshire’s Class B shares and invests in 20 other stocks from Berkshire’s equity portfolio. To enhance income generation, the fund employs an options strategy, primarily focusing on writing call options.
VistaShares CEO Adam Patti emphasizes the fund’s unique position, stating, “Berkshire clearly has a broad investor base, and Warren Buffett is the best investor ever. Since Berkshire does not pay dividends, we saw an opportunity to replicate its holdings while targeting a 15% annual yield.” Distributions from the ETF are made monthly, providing a steady income stream for investors.
As of its latest close at $19.15, the ETF stands out among others that utilize call option writing to boost income. A notable competitor is the JPMorgan Equity Premium Income ETF (JEPI), which manages $40 billion and currently offers an 11% yield. Given its income-focused strategy, the Berkshire ETF may be particularly suitable for tax-advantaged accounts like IRAs and 401(k)s.
While the fund’s call writing strategy may limit potential upside during aggressive bull markets, it is designed to perform well in flat market conditions, leveraging option income. Although the strategy does not shield investors from downturns, the income generated can help mitigate stock price declines during bear markets.
Since its inception, the Berkshire ETF has remained relatively flat in total return, with the underlying index of 21 stocks declining approximately 4%. However, the income generated from the options strategy has aligned with its 15% annualized goal. The ETF undergoes quarterly rebalancing, with the most recent adjustment occurring in May. As of the latest update, its largest holdings include Apple (10.2%), Berkshire B shares (9.8%), American Express (8.4%), and Coca-Cola (6.2%).
Investors should note that this fund is not primarily aimed at those seeking significant capital gains from Berkshire’s stocks. “Our primary goal is to achieve a 15% yield, with capital appreciation as a secondary objective,” Patti explains. “We aim for maximum upside without compromising our yield target.”
In addition to the Berkshire ETF, VistaShares has plans to launch a series of actively managed ETFs that will invest in the publicly disclosed holdings of other prominent investors, including Bill Ackman, Stan Druckenmiller, and Michael Burry. These new funds are expected to debut by Labor Day, alongside a new Berkshire ETF that will also invest in the same 21 stocks.
**FAQ Section:**
**Q: What is the primary investment strategy of the VistaShares Target 15 Berkshire Select Income ETF?**
A: The ETF aims to provide a 15% annual yield by mirroring Warren Buffett’s equity portfolio, investing in Berkshire Hathaway stocks, and employing a call options strategy to generate additional income.
