Twelve-Year-Olds Beat Buffett In Stock Contest

Who needs Warren Buffett when you can go to Jeff Klubek and Tim Getty?

The two beat the renown billionaire investor returns by a wide margin, delivering 37 percent and 58 percent returns on their stock portfolios in two 10-week periods since October. The names of these money managers don’t ring a bell? They shouldn’t.

Klubek and Getty are only 12 years old.

The two boys, armed with a hypothetical kitty of $100,000, made their killing with bets on Intel Corp., Microsoft Corp., other computer companies and one airline, winning a stock-picking competition among 650,000 New York elementary, middle and high school students.

“We just hoped they would go, and they did,” said Getty, who like Klubek is a seventh-grader at Our Mother of Good Counsel school in Blesdell, N.Y., outside Buffalo. “We also prayed a lot.”

Though the pair outperformed Buffett considerably, they still followed the Omaha stock-picker’s central investment tenet right down the line, focusing on companies they knew well. Getty and Klubek had noticed that friends and grown-ups had computers with Microsoft software and Intel processing chips.

They also became unwitting followers of so-called momentum investing, throwing their money into an industry whose shares are rising.

The two built their first portfolio Oct. 9, putting their $100,000 into shares of three companies they had been watching for several weeks: Intel, Texas Instruments Inc. and United Airlines parent UAL Corp.

By Dec. 18 their portfolio had risen 58.6 percent. That won them the first round of competition in The Stock Market Game, a competition sponsored by the New York State Council on Economic Education.

Shares in Buffett’s investment holding company, Berkshire Hathaway Inc., by contrast, rose just 3.76 percent.

In the second round, the boys put their $100,000 into Microsoft, Intel and Dell Computer Corp. By May 1 they had earned 37.78 percent on their investments.

Berkshire rose 4.72 percent in the same period.