Billionaire Warren Buffett Reallocates Capital to Various Assets Following Sale of Bank of America and Strategic Exit from U.S. Equity Market
In late 2024, Buffett’s Berkshire Hathawayamasseda $334 billion cash position after the firm became net-sellers of assets including the sale of 117 million Bank of America (BAC) shares, worth about $5.5 billion.
Berkshire Hathaway’s sale appears to be a masterful and timely move as the S&P 500 lost as much as $5.5 trillion in market cap this year.
Regulatory filings show that Berkshire Hathaway gobbled up shares in five Japanese trading houses: Itochu, Sumitomo, Marubeni, Mistubishi and Mitsui,reportsNikkei Asia. The documents show that Berkshire Hathaway increased its Mistui holdings from 8.09% to 9.82%, Mitsubishi from 8.31% to 9.3% and Marubeni from 8.23% to 9.29%.
The Oracle of Omaha also upped his firm’s stash in Sumitomo from 8.23% to 9.29% and Itochu from 7.47% to 8.53%.
In his annual letter to shareholders, Buffettsaysthe five Japanese trading companies are not so different from how Berkshire Hathaway operates.
Explains Buffett,
“Each of these large enterprises, in turn, owns interests in a vast array of businesses, many based in Japan but others that operate throughout the world.”
Berkshire Hathaway is known for its long-term investments, purchasing stocks and companies with solid fundamentals.
Buffett says Berkshire Hathaway started to accumulate shares in the five firms in 2019. According to the legendary investor, his firm has no plans of unloading its shares in the five Japanese trading houses anytime soon.
“Our holdings of the five are for the very long term, and we are committed to supporting their boards of directors. From the start, we also agreed to keep Berkshire’s holdings below 10% of each company’s shares.
But, as we approached this limit, the five companies agreed to moderately relax the ceiling. Over time, you will likely see Berkshire’s ownership of all five increase somewhat.”
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