By Warren Buffett’s favorite financial metric, Berkshire’s net worth is $663 billion, leaving Nvidia ($66 billion) and Apple ($57 billion) in the dust

So what gives? The deeper we delve into the bizarre Berkshire anomaly, the much singular it seems and the much invaluable the explanations become. The institution is virtually successful a people of its own. It isn’t a tech company, but its marketplace headdress beats those of each different non-tech companies by specified a immense borderline that it doesn’t look to beryllium 1 of them, either; its runner-up successful that group, Walmart, would person to get 41% much invaluable conscionable to lucifer Berkshire’s marketplace cap.

Another mode to see the magnitude of Berkshire’s achievement: So acold successful this tech-infatuated year, Berkshire’s banal has outperformed the shares of Apple, Microsoft, and Alphabet. It has beaten the tech-heavy Nasdaq arsenic good arsenic the S&P, the Dow, and the Russell 2000. It’s hard to retrieve that CEO Warren Buffett told his shareholders past February, “All successful all, we person no possibility of eye-popping performance.”

But past show tin beryllium measured successful galore ways, and marketplace capitalization isn’t Buffett’s favourite mode of evaluating a company. Market headdress gauges the market’s expectations, not measurable fiscal results, and arsenic Buffett often notes, Mr. Market has temper swings. Buffett focuses alternatively connected nett worthy arsenic calculated by mostly accepted accounting principles (GAAP). The conception is simple: Add up a company’s assets and past subtract its liabilities. What’s near is nett worth. Apple’s nett worthy is $57 billion. Nvidia’s is $66 billion. Berkshire’s is $663 billion. Some of the different tech giants person a higher nett worthy than Apple and Nvidia have, but nary scope adjacent fractional of Berkshire’s. As Buffett besides told investors successful February, “Berkshire present has—by far—the largest GAAP nett worthy recorded by any American business.”

Students of Berkshire mightiness entity that the institution is much of a tech concern than it appears to be, since it owns a batch of Apple stock. But the statement doesn’t clasp up. Berkshire owns respective security companies (GEICO is champion known) and invests customers’ premiums successful immense banal portfolios—and Apple is its largest holding. But Berkshire has been offloading its Apple shares for astir a year, with astir 70% of its holdings gone truthful far. That is, Berkshire banal has been rising arsenic the institution gets retired of tech, dumping its Apple shares and collecting tremendous gains.

Which brings america to the decades-old concealed of Berkshire’s breathtaking performance, highlighted by banal marketplace events of the past year. It is, of course, nary secret. It’s Buffett, a fiercely independent, scorchingly intelligent CEO. He often seems serenely retired of measurement with the world, arsenic erstwhile helium sells Apple banal into a rising market. Other concern bromides helium disdains:

· Everyone knows diversified conglomerates are a unspeakable idea. Decades of bountiful probe person shown they underperform. But successful 2015, Buffett told his shareholders, “Berkshire is present a sprawling conglomerate, perpetually trying to sprawl further…. If the conglomerate signifier is utilized judiciously, it is an perfect operation for maximizing semipermanent superior growth.” The operation “used judiciously” is his humble mode of saying “used arsenic good arsenic I usage it.”

· CEOs don’t scorn their company’s stock. But implicit the years Buffett has told shareholders erstwhile helium thinks Berkshire shares are overpriced, and helium warns them of imaginable occupation ahead, arsenic helium did again this year. Berkshire is ever looking for companies to buy, but it has grown truthful big, helium said, that “there stay lone a fistful of companies successful this state susceptible of genuinely moving the needle astatine Berkshire,” and for assorted reasons helium isn’t funny successful buying them. Outside the U.S. “there are fundamentally nary candidates that are meaningful options….” That’s wherefore helium said “eye-popping performance” won’t beryllium happening. Yet shareholders didn’t tally for the exits. Just the opposite. They spot him to find a way.

· Companies beforehand the products they merchantability by utilizing them. Berkshire often does, but not always. It sells directors and officers insurance, which indemnifies committee members against idiosyncratic liability for their actions. But not astatine Berkshire. “We bash not supply [board members] directors and officers liability insurance, a fixed astatine astir each different ample nationalist company,” Buffett said successful his 2011 letter. “If they messiness up with your money, they volition suffer their wealth arsenic well.”

It seems astounding that Buffett has someway barged into the exertion royals’ jamboree, but it shouldn’t be. He has been truthful fearlessly unconventional for truthful galore years that precise small should astonishment us. If it were otherwise, Berkshire banal wouldn’t person accrued 4,384,748% nether his 60 years of management.

Buffett ne'er ceases to amaze. This is conscionable his latest mind-bender: A 94-year-old CEO joins the tech bros and successful immoderate ways outdoes them.