Warren Buffett’s Berkshire Hathaway has been steadily trimming its stock holdings, and this trend continued in Q3 with a significant sale of Bank of America shares.
Since July 17, Berkshire sold 150.1 million shares for $6.2 billion, cutting its stake in the mega bank by 14.5%, although it remains the largest shareholder with an 11.4% stake, valued at around $36 billion.
Speculation is swirling about why Buffett is scaling back on his core holdings.
Some say he’s hedging against overvalued markets, preparing for a major acquisition, or simply managing business risk as valuations soar.
Haruki Toyama, portfolio manager at Madison Investments, believes it’s less about a market crash and more about caution, noting that the “Buffett indicator” shows stocks are expensive compared to historical norms.
This move may foreshadow a more conservative stance in Berkshire’s business strategy, especially as the company’s cash reserves reach historic highs.
Buffett’s history with Bank of America stretches back to 2007, weathering the global financial crisis and reaping massive profits. However, rising interest rates and growing concerns over banking risks may be influencing his recent sales.
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