Warren Buffett is no fan of British stock market regulations because they make it more expensive for him to build sizeable stakes, the Sage of Omaha told a packed press conference as he wrapped up his annual weekend shareholder extravaganza.

In a 2½ hour question-and-answer session attended by journalists from around the world, Mr Buffett took issue with the requirement for an investor to disclose publicly their holding in a listed UK company when the stake reached 3 per cent of the company’s market capitalisation.

He said: “Disclosure is always a problem because, when you make it public, people jump in and the share price goes up.” He noted that, typically, he would like to invest between $2 billion and $3 billion in a company with a $10 billion (£5 billion) market capitalisation, but, with the 3 per cent disclosure rule, any investment in a UK company of this size would have to be much smaller. Mr Buffett amassed a 2.9 per cent stake in Tesco, which he disclosed to his Berkshire Hathaway investors on March 1, sending shares in Britain’s biggest supermarket chain up by 2.1 per cent.

Mr Buffett said that most investors would be better off putting their money into low-cost index-linked funds, although he believes that he can still outperform the prominent market indices.

“A very low-cost index is going to beat a majority of the amateur-managed money or professionally managed money,” he said, adding that investors should not flock to increasingly popular hedge funds, where managers typically receive a fixed 2 per cent management fee along with a fifth of the profits. “The gross performance [of a hedge fund] may be reasonably decent, but the fees will eat up a significant percentage of the returns,” he said. “You’ll pay lots of fees to people who do well, and lots of fees to people who do not do so well.”

Mr Buffett, 76, who is both chief executive and chief investment officer of Berkshire Hathaway, also shed more light on who might succeed him when he steps down. He said that the board had approved one candidate from a shortlist of three to take over the chief executive’s duties, should he die tomorrow. However, he said, the identity of his successor could change over time. None of the contenders has been identified.

Mr Buffett, whose role will be split after he retires, added that whoever replaced him as chief investment officer would “probably be paid a relatively small salary, less than they were making previously, that’s for sure”, because their compensation would be more closely related to the performance of the company’s portfolio.

As usual, Mr Buffett oozed Midwestern charm. Asked about the modest scale of the wedding to Astrid Monks, his long-term companion, last year, he quipped: “It’s like buying a stock — we don’t want a lot of publicity ahead of time.”

Another audience member wondered why he seemed so healthy despite his well-known love of burgers, steaks and cherry Coke.

“I never smoke or drink alcohol,” he said. “I’m in a job with no stress, surrounded by people I love. When you have everything in life, you can eat a little peanut brittle [a snack of questionable goodness].”

Elsewhere in Omaha, the fun continued as the weekend-long event switched from the six-hour shareholder meeting on Saturday to become a social event on Sunday.

In one corner of an out-of-town mall that had been opened specially for the occasion, Bill Gates, the Microsoft chairman and a board member of Berkshire Hathaway, played bridge with Mr Buffett. Near by, Ariel Hsing, 11, who is the girls’ under16 US table tennis champion, was taking on and dispatching all challengers.

Joydeep Chakravarti, the manager of a software company in California, who also runs an investment partnership, travelled to Omaha for the weekend in a group of 12.

He said: “I come here as much for the social side as to hear Warren’s investment advice. It’s great to meet like-minded people and, in the past, I have made some good contacts.”

Eli Jabans, 87, a shareholder who has been attending for more than 25 years, said that the event had grown considerably. “In those [early] days there were maybe 1,000 or 2,000 people and it was held in a little theatre,” he said. “It has just kept on growing since then.”

About 27,000 people took part this year and, if Mr Buffett has his way, the figure next year will be higher still.

Warren’s way

— Controls Northern Electric Distribution and Yorkshire Electric Distribution, which jointly supply electricity to 3.7 million homes in the North East of England

— Owns a 2.9%* stake in Tesco

— Other significant minority holdings include: American Express (12.6%), Anheuser-Busch (4.7%), Coca-Cola (8.6%), Conoco Phillips (1.1%), Johnson & Johnson (0.7%), Moody's Corporation (17.2%), PetroChina (1.3%), Procter & Gamble (3.2%), Wal-Mart Stores (0.5%), The Washington Post Company (18%), Wells Fargo (6.5%)

* percentage of holdings as of March 1

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