Berkshire Hathaway (BRK.B) sold its entire positions in both the SPDR S&P 500 ETF Trust (SPY) and Vanguard S&P 500 ETF (VOO) during the fourth quarter of 2024, according to Securities and Exchange Commission filings released last week, as the investment giant continues its longest selling streak in years.
The decision to fully exit both leading exchange-traded funds rather than maintain smaller positions comes as Berkshire accumulates its largest-ever cash reserve, suggesting Warren Buffett sees limited opportunities in the current market environment despite the S&P 500's strong performance.
The conglomerate sold its entire stake of 39,400 shares in SPY valued at $22.6 million and 43,000 shares of VOO worth $22.68 million, according to a 13F filing. The sales occurred during a quarter when the S&P 500 gained 2.4% and finished 2024 with a 25% return.
"While we don't have insight into their exact reasoning, this could indicate concerns about market valuations, increased volatility, or even a shift toward individual stock selection over broad index exposure," according to Daniel Milks, founder of Fiduciary Organization & Woodmark Advisors.
The relatively small positions represented just a fraction of Berkshire's massive portfolio, but the timing of the complete exit from both funds has caught analysts' attention.
"Large investment firms often 'clean up' their portfolios by exiting smaller positions that don't significantly impact overall performance," Melissa Caro, founder of My Retirement Network, told etf.com.
The sales align with Berkshire's broader strategy of reducing equity exposure, as the company has been a net seller of stocks for nine consecutive quarters, according to the SEC filings. Since these fillings only reflect last year's fourth quarter positions, any potential new moves Berkshire has made in 2025 won't be known until future disclosures.
"What's more notable is that Berkshire sold significant stakes in individual companies that make up a large portion of these ETFs and the broader indices they track. That's where the real attention should be," Caro said. "Selling SPY and VOO doesn't necessarily imply a bearish market outlook, but trimming major individual holdings could signal something about Berkshire's view on specific stocks or sectors."
Caro noted that Buffett typically recommends index funds for individual investors while pursuing a different strategy for Berkshire, reflecting the distinct advantages and resources available to the institutional investor.
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"Given Warren Buffett's history of emphasizing long-term investing, this isn't necessarily a warning sign for retail investors to panic," Milks explained. "Instead, it may reflect Berkshire's preference for direct stock holdings or a belief that certain sectors within the S&P 500 are overvalued."
In the ongoing battle for ETF market share, SPY has since reclaimed its position as the largest ETF with $636.6 billion in assets, despite experiencing $2.1 billion in outflows over the past five days, according to etf.com data. Meanwhile, VOO has reached $635.2 billion in assets under management, attracting $1 billion in net inflows during the same period.
Rather than simply reducing exposure to one fund, Berkshire's complete exit from both exchange-traded funds comes alongside the accumulation of a record-breaking cash reserve exceeding $300 billion, according to the SEC filings, suggesting a cautious stance amid current market valuations.
The conglomerate has also reduced holdings in financial institutions like Bank of America Corp. (BAC) and Citigroup Inc. (C), while maintaining its substantial Apple Inc. (AAPL) position, which remains its largest single-stock investment.
