Buffett wrote that he doesn't view these investments as "stock market wagers — dalliances to be terminated because of downgrades by 'the Street,' an earnings' miss,' expected Federal Reserve actions, possible political developments, forecasts by economists or whatever else might be the subject du jour."
Rather than stock holdings, Buffett views these as companies Berkshire Hathaway "partly owns." He added that these are companies "earning more than 20% on the net tangible equity capital required to run their businesses" and are profitable "without employing excessive levels of debt."
In the long run, he remains bullish on equities, noting that they'll outperform fixed-income investments.
"Returns of that order by large, established and understandable businesses are remarkable under any circumstances," Buffett wrote. "They are truly mind-blowing when compared to the returns that many investors have accepted on bonds over the last decade — 2 1/2% or even less on 30-year U.S. Treasury bonds, for example."
Berkshire's stock investments delivered unrealized gains of $53.7 billion in 2019 as stocks surged to all-time highs.
That said, the 89-year-old billionaire investing legend suggested that investors ignore that figure because of a new GAAP rule that requires earnings to include the net change in unrealized gains and losses. A year ago, Berkshire posted unrealized losses of $20.6 billion as stock prices fell.