What Is Warren Buffet’s #1 Private Investment? [Dave Forest]

Have you encountered a presentation featuring Dave Forest that has the title “Buffett’s $12 Billion Lie”?

In the header of the presentation, it states “Private investment previously reserved for billionaires leads small group of Americans to extraordinary gains as high as 3,194%...” implying that Dave is in on a secret type of investment he intends to reveal to his audience.

I sat through the presentation and came away with a few takeaways that I will be sharing with you in this article. Keep reading to get a gist of what this presentation is all about.

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What is Warren Buffet’s #1 Private Investment? (The Pitch)

In a presentation recently published by Casey Research titled Warren Buffet’s #1 Private Investment or Buffett’s $12 Billion Lie, Rachel Bodden and Dave Forest talk about a private investment vehicle that was previously only accessible to the rich.

Warren Buffet's #1 Private Investment (Buffet's $12 Billion Lie) by Dave Forest

The whole thing centers on a private investment strategy that has apparently been used by Warren Buffett, one of the richest men on the planet, in secret to generate up to $12 billion.

They imply that sometimes, what Buffett says in public isn’t necessarily what he does in private with his portfolio. And, therefore, if you want to make money, follow his actions and not his words.

What secret private investment is Buffett in on?

Rachel claims that Warren Buffett once made a secret trade that netted him $12 billion. Here is how she describes it:

“I’ll reveal one huge claim Buffett made 18 years ago…

When he called a specific type of investment a ‘financial weapon of mass destruction…’

But then he turned around and acquired $700 million in these ‘financial WMDs’ in a private back room deal…

And made 12 billion bucks doing it!”

She then clarifies that it has nothing to do with cryptocurrencies, options, IPOs, or pre-IPOs adding that it involves real companies:

“Because these are actual companies producing real goods and services. They’re already bringing in cash.”

The investment Rachel is talking about wasn’t available to the general public, and was used by the rich. But now, thanks to a loophole in SEC Rule 30.52, average investors can also trade it.

Dave then says this about the mysterious investment:

“I want to start out by giving you a hint. Actually two hints. First, it starts with ‘W.’

Second, that letter — W — is also a code that lets you spot these deals too.”

He then says that they are like private shares issued by public companies and that they are usually listed alongside stocks.

Although he later reveals it, I could quite easily tell that he was referring to Warrants.

This isn’t the first time we are coming across a guru basing their presentation on warrants; they were featured in E.B. Tucker’s presentation about “Gold Placements.”

Warrants are a special type of contract that works like an option that gives you the right (and not an obligation) to buy some assets at a future date at a specific price. They are different from options because they are issued by the company (whereas options are issued by an exchange like the CBOE).

Although you can trade some warrants publicly, some companies usually issue them privately and you have to buy from them.

Although any company in any sector can issue them, they are quite commonly used by small mining companies to raise capital that they would otherwise not have access to via conventional means due to the high level of risk involved (small unproven junior miners are volatile).

Something to consider as you trade them is that warrants earn higher returns when the underlying asset goes up, but lose more (than the asset e.g. the stock) if it goes down.

The investment referenced earlier that made Warren Buffet $12 billion was warrants that he bought from Bank of America.

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Who is Dave Forest?

David Forest is an investment analyst who has been working for Casey Research since 2004. He edits three financial newsletters, namely Strategic Investor, Strategic Trader, and International Speculator.

Dave Forest is a geologist by profession and has spent more than 20 years working professionally in the mining industry. Among other engagements, he has served as a managing director of Notela Resource Advisors, an advisory firm that looks for opportunities in natural resources.

He has founded mineral exploration and development companies that have raised more than $80 million in capital from some well-known resource investors. In the presentation, he claims to have used warrants to raise capital.

He travels all over the world in search of interesting resource projects that can earn him and his followers returns.

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What is Strategic Investor? (The Newsletter)

Strategic Investor is a newsletter offered by Dave Forest that provides investors with insights on how to trade warrants. He decided to dedicate it to warrants because he realized that there aren’t many resources geared towards those private investments for retail investors.

When you subscribe to Strategic Investor, you receive:

  • One year membership to the newsletter and 12 monthly issues. Each issue has one recommendation.
  • 24/7 access to the members-only website where you can retrieve past issues and reports as well as view the model portfolio.
  • Dave Forest’s Warrants Master Course. It comprises five videos in which Dave Forest shows you how warrants work.
  • The Warrant Play Set to Triple or More. This dossier has the name of the first play you can implement to try out Dave’s strategy.
  • The 2021 Gold Spike Action Plan
  • “Strategic Profits Library”

How much does it cost to join Strategic Investor?

In your first year, you will pay $49 but to renew in subsequent years, they charge $129.

Do you get a refund if you cancel your membership?

You are entitled to a full refund of the subscription fee if you cancel your membership within the first 60 days.

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Closing Remarks on Warren Buffet’s #1 Private Investment

Warren Buffet’s #1 Private Investment is a teaser by Dave Forest meant to advertise his investment research service, Strategic Investor.

Dave and Rachel Bodden (the host) spend a great deal of time cultivating mystique around them as a vehicle for investment but we reveal that the “private investment used by Warren Buffet to make $12 billion” was warrants.

Although Dave Forest paints them as an exclusive investment vehicle that costs very little and multiplies the typical gains made by stocks, you should not forget that they also lose more money when those stocks fail to perform well. Therefore, you can lose more money when a stock does badly if you buy warrants than you do by buying stocks.

You have to subscribe to Strategic Investor to receive more details about warrants from Dave. Don’t forget that although the first year only costs $49, the newsletter renews at $129 per year after that.

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